A couple of weeks ago the 2015 Federal Budget was delivered, and now that we’ve all had a bit of time to digest it (if you have been so inclined…) I thought I’d take some time to discuss a couple of areas of interest over the course of this week.
In recent years the Government have alluded to a reduction in the company tax rate for small businesses. While this was a positive measure, I always felt that it wasn’t really going to help many small businesses – why, you might ask? Because only approximately 30% of small businesses are operated through a company structure, most are sole traders and partnerships – and as such, this cut to the tax rate wasn’t going to have an impact on them.
In the recent budget the Treasurer announced a discount of 5% (up to $1,000) on income tax payable by individuals on business income from a non-corporate entity where that entity has aggregated turnover of less than $2 million. The small business tax discount is to apply from 1st July, 2015, you just need to remember that it is not actually a reduction in your tax rate, but if this applies to you, you will receive a rebate in your tax return.
It’s a welcome measure to all small businesses (including mine!)…