Small and medium businesses
Running a small to medium business can be a tough, but rewarding, experience.
Allowing you to pursue your passions and give back to the community in your own way, whilst also providing financially for yourself and your family.
It has been relatively quiet in Federal Parliament concerning many of the proposed superannuation, investment and taxation measures that were released in the 2018 Federal Budget.
Despite this, over the last few months, several proposals have moved through the Federal Parliamentary Process and become enshrined in law.
In light of this, here are a few legislative changes that may help you to maintain, preserve and grow your business now and into the future:
- Corporate tax rate. The corporate tax rate for base rate entities (i.e. derive no more than 80% of income in passive forms and have an aggregated turnover of less than $50 million) will be:
- 27.5% for the 2018-19 and 2019-20 financial years (unchanged timeframe);
- 26% for the 2020-21 financial year (timeframe brought forward); and,
- 25% for the 2021-22 financial year and later financial years (timeframe brought forward).
- Small business income tax offset. The small business income tax offset for unincorporated small businesses (i.e. have an aggregated turnover of less than $5 million) will be:
- 8% for the 2018-19 and 2019-20 financial years (timeframe unchanged);
- 13% for the 2020-21 financial year (timeframe brought forward); and
- 16% for the 2021-22 financial year and later income years (timeframe brought forward).
Treasury Laws Amendment (Lower Taxes for Small and Medium Businesses) Act 2018. Royal assent on 25 October 2018.
- Accelerated depreciated for small business. The period during which small business entities (i.e. have an aggregated turnover of less than $10 million) can access expanded accelerated depreciation rules (i.e. the $20,000 instant asset write-off) has been extended by 12 months to 30 June 2019.
Small business entity Treasury Laws Amendment (Accelerated Depreciation for Small Business Entities) Act 2018. Royal assent on 21 September 2018.
