This year’s Federal Budget is based on a ten-year enterprise tax plan designed to stimulate more small business activity by boosting new investment, creating jobs and increasing real wages.
All Australian small businesses from 1 July 2016 with an annual turnover of less than $10 million will have access to:
- Simplified depreciation rules: These include immediate tax deductibility for asset purchases costing less than $20,000 until 30 June 2017.
- Simplified trading stock rules: New rules will give businesses the option to avoid end of year stocktake if the value of their stock has changed by less than $5,000.
- Simpler PAYG instalments: Instalments will be calculated by the ATO,removing the risk of under or overestimating PAYG and the resulting penalties that may be applied.
- The option to account for GST: Small businesses will have the option to account for GST on a cash basis and pay GST instalments as calculated by the ATO.
- Other tax concessions: Other tax concessions that are currently available to small businesses, such as fringe benefits tax (FBT) exemptions (from 1 April 2017 to align with the FBT year).
- A trial of simpler BAS: The trial is to reduce GST compliance costs, with a full roll-out from 1 July 2017.
These threshold changes will not affect eligibility for the small business capital gains tax concessions, which will remain available for businesses with annual turnover of less than $2 million or that satisfy the maximum net asset value test.