A welcome news for small businesses this year was the extension of the AU$20,000 write-off on taxes, from AU$1,000 write-off concessions in previous fiscal years. There is also a decrease in the company tax rate for small businesses, making more companies eligible for small business tax concessions.
As a small business, you can now access these tax concessions:
- Income tax concessions
- Capital Gains Tax concessions
- Excise tax concessions
- Pay As You Go instalment concessions
- Fringe Benefit Tax concessions
- Super concessions
Income tax concessions
From 1 July 2016, turnover thresholds for these concessions are AU$5 million for small business income tax offset, and AU$10 million for all other income tax concessions. Note that the threshold up to 30 June 2016 is AU$2 million for all these concessions.
Your company may also be eligible for capital gains tax (CGT) concessions on assets used to conduct your small business. These are also called “active assets.” The turnover threshold for CGT concessions of AU$2 million remains unchanged.
GST and excise tax concessions
Turnover threshold for these concessions is AU$10 million from 1 July 2016. Up to 30 June 2016, the turnover threshold is AU$2 million.
PAYG instalment concessions
Your small business also has the option to pay as you go (PAYG) by instalment using the amount the Australian Taxation Office (ATO) works out for you. This will help you save time figuring out the amount you need to pay. You can also vary this amount each quarter, if required.
The ATO calculates instalment amounts based on information your small business has previously reported. They then adjust it according to your business’s likely growth and/or investment income. From 1 July 2016, the turnover threshold for this concession is AU$10 million. Up to 30 June 2016, the threshold is AU$2 million.
Your small business may be eligible for fringe benefits tax (FBT) concessions. The FBT concessions turnover threshold is AU$10 million from 1 April 2017, and AU$2 million up to 31 March 2017.
Your company may be eligible for super concessions if you have 19 or fewer employees or a turnover under AU$10 million, the Small Business Clearing House will help you pay super guarantee contributions for all your employees in a single electronic payment.
If you need more information and advice which concessions your small business is eligible for, visit the ATO website and consult with your accountant.