Chartered Accountants
As a tax concept, “entertainment” can be relevant not only to fringe benefits tax but also to income tax and even goods and services tax.
Read the full December Newsletter here
Christmas will be here before we know it and the well prepared business owner knows that a little tax planning can help make sure there’s no unforeseen tax problems.
Three benefits typically provided include:
Read the full November Newsletter here
After waiting for what seems like an eternity, the government has finally put to Parliament its draft legislation around two of its schemes.
Read the full October Newsletter here
Look before you leap: the small business CGT concessions.
The CGT relief concessions that are available to small business can be very generous. However they can also be complex and confusing so knowing a few of the finer details can go a long way to ensuring your small business can take best advantage of them.
Read the full September Newsletter here
As part of the 2016-17 Budget, the Government announced that it intended to reduce the corporate tax rate progressively from 30% to 25% for eligible small business and legislation has now been passed to officially enact this reduction effective from 1 July 2016.
Further, the definition of small business entity for the purposes of accessing this reduced tax rate is, broadly, a business with an aggregated turnover of less than $10 million (an increase from the previous $2 million turnover threshold).
Additional Small Business Concessions
In addition to the lower tax rates, small businesses that qualify under the increased $10 million threshold may also have the ability to utilise further concessions for small businesses including:
We note that the increase in the turnover threshold for small business does not extend to the Small Business CGT concessions. The aggregate turnover threshold for these concessions will remain at $2 million.
Changes to Imputation/Franking Credits
With the reduction in the small business company tax rate to 27.5% commencing 1 July 2016, a corresponding change in the level of imputation credits will also apply. From 1 July 2016, imputation credits attached to dividends paid from small business entities to their shareholders will only be able to be franked to a maximum level of 27.5%.
This change will likely impact on small businesses that have already issued dividends and provided statements to their shareholders showing a 30% franking credit. As the law was only passed on 19 May 2017, it is possible that dividend statements issued since 1 July 2016 will show a 30% rate and will therefore be incorrect.
Should this be the case, the ATO has issued a draft practical guideline on how to deal with this.
The team at Montague Partners are available to help you through these issues or any other tax and business queries you may have.
