As the economic recovery from the pandemic continues to play out, looking at ways to get on top of your cash flow will be important heading into the new financial year.
Check out the information on tax, government programs and grants to ensure your business is making the most on what's on offer to help drive growth. Always seek professional advice from your accountant to understand the best option for you.
Australian businesses earning less than $50 million will see their company tax rate reduced to 26% for the 2020-21 year and 25% for the 2021-22 year. The rate for businesses with more than $50 million in annual turnover remains at 30%. A rate of 17% will apply for biotech innovation firms. Visit the Australian Taxation Office for more information.
NSW: A reduction in payroll tax rate to 4.85% will continue for 2021-22 financial year and the tax-free threshold is $1.2million.
SA: Businesses with wages up to $4 million will receive payroll tax waiver for April to June 2021.
NT: A payroll tax waiver is available until June 2021 for employers on the DITT Business Hardship Register and with total taxable wages under $7.5 million.
VIC: Businesses with payroll of up to $10 million can defer payroll tax for the 2020-21 financial year.
As part of the 2021-22 federal budget, the Government announced temporary full expensing will be extended for 12 months.
Businesses with an aggregated turnover of less than $5 billion will be able to deduct the full cost of eligible depreciating assets that are first held, used or installed ready for use for a taxable purpose from 7.30pm AEDT on 6 October 2020 to 30 June 2023. This will be an extension from 30 June 2022.
Treasurer Josh Frydenberg said: “Over 99% of businesses, employing over 11 million workers, can write off the full value of any eligible asset they purchase.
"This has seen their spending on machinery and equipment increase at the fastest rate in nearly seven years… we again go further, announcing the extension of these measures for a further year until 30 June 2023, so a tradie can buy a new ute, a farmer a new harvester and a manufacturer expand their production line."
These measures are designed to turbo charge the speed of the deduction and lower tax bills to help with your cash flow.
Temporary full expensing also applies to eligible second-hand assets for businesses with an aggregated turnover less than $50 million. For assets acquired prior to this date, the instant asset write-off measures apply. Businesses with an aggregated turnover of less than $500 million may deduct the full cost of an asset up to $150,000.
The Australian Government has also announced an extension to the temporary loss carry-back. This will allow eligible businesses with a turnover of less than $5 billion to carry-back tax loss from the 2022-23 income year and apply it against tax paid in a previous income year. The scheme can be applied retrospectively as far back as the 2018-19 income year.
The program is designed to provide support for businesses looking to start or expand operations in New South Wales. It’s open to businesses who create a minimum net growth of 30 new full-time equivalent jobs in NSW before 30 June 2024.
As part of the program, you can receive tax relief on wages for up to four years and subsidised training package rebates. The Jobs Plus Program is open until 30 June 2022 or until support is fully allocated. You must start hiring staff before 30 June 2022.
Eligible small businesses, sole trader and not-for-profit organisations in New South Wales can apply for the $1500 rebate on small business fees and charges. The rebate is available until 30 June 2022.
Small Business COVID-19 Adaption Grant Program
The Queensland government is extending the Small Business COVID-19 Adaption Grant program for regional Queensland as part of the state’s stage 2 recovery strategy. Eligible businesses can apply for a grant of between $2,000 to $10,000 to adapt and sustain their operations during the recovery period. Visit Business Queensland for more information and to apply.
Export Assistance Grant
The New South Wales government is providing funding of up to $10,000 for eligible export businesses in New South Wales to access global markets. Find out the eligibility criteria or how to apply.
Looking for funding to grow your business? Find out in just 10 minutes what grants you could be eligible for from a range of over 1500 government grants worth almost $40 billion. To start browsing, simply join My Business as a free member.
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