The Budget 2016-2017
As you know the budget came out earlier this month and there are a number of interesting changes coming our way.
Amongst these changes the lowering of the tax burden on enterprises:
- The Government will back small businesses by reducing their tax rate to 27.5 per cent, starting with businesses with a turnover less than $10 million on 1 July this year.
- Over ten years the Government will decrease the tax rate on all companies to 25 per cent by 2026–27
(Rolling our eyes on this one this one with future successive governments in position to scuttle this)
Assistance to small businesses is also on the agenda with these changes on the horizon:
- From 1 July 2016 all businesses with annual turnover of less than $10 million will have access to:
- simplified depreciation rules, including immediate tax deductibility for asset purchases costing less than $20,000 until 30 June 2017;
- simplified trading stock rules, giving them the option to avoid end of year stocktake if the value of their stock has changed by less than $5,000;
- a simplified method of paying PAYG instalments calculated by the ATO, which removes the risk of under or over estimating PAYG instalments and the resulting penalties that may be applied;
- the option to account for GST on a cash basis and pay GST instalments as calculated by the ATO;
- other tax concessions 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 business activity statements (BAS), reducing 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.
For a full report on the budget and changes that may affect you go to: www.budget.gov.au