We’ve known for a while that small business entities (SBEs) have had until 30 June 2017 to take advantage of being able to claim an immediate deduction for assets costing less than $20,000.  So what’s all the fuss about now?

The Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016 has now been passed by the senate and is finally awaiting royal ascent.

This provides a limited window of opportunity for business owners with an SBE annual aggregated turnover is between $2M and $10M in either the current or previous financial year as you are now able to utilise the SBE rules and claim an immediate deduction for assets costing less than $20,000!  You must be quick though because this opportunity ceases on 30 June 2017 with the $20,000 write off again reverting back the previous $1,000.

This is great news for business owners as the following concessions are now available for more businesses:

  • Reduced tax rate of 27.5% for SBE companies (in 2014/15 for SBE companies it was 28.5% and for companies over $2m it was 30%);
  • Simplified depreciation ($20,000 immediate deduction for certain assets until 30 June 2017);
  • Simplified PAYG instalments;
  • Simplified trading stock;
  • Access to business restructure roll over relief;
  • Elect to account for GST on a cash basis;
  • SBE FBT concessions (from 1 April 2017);
  • Immediate deductibility for business start-up costs.

For unincorporated SBE Entities with less than $5million aggregated annual turnover

  • An increase in the SBE tax discount to 8% for individuals (up to $1000)

Contact us to discuss what concessions may be able to benefit you if the bill passes Royal Assent in May 2017!

If this was of interest or benefit to you, please forward to a friend.

The information provided in this blog is general in nature and not to be taken as tax advice.  Contact our office for more information.