Don’t Expose Your Business To Penalties
‘Never fear – Tax time is here.’ We bet you’ve never heard that before! But really it’s not as daunting as it’s made out to be. As business owners, we can understand how the financial vernacular can cause one to pull their hair out and place you under a perpetual state of perplexity.
To help relax you, here’s some advice – minus the usual jargon.
With June 30 behind us, we’re sure you have managed to examine those last minute tactics to minimise your tax. These include receiving and allocating all employee superannuation payments, reviewing shareholder loan accounts, carrying out stocktake, writing off any bad debts and trading stock that is damaged or obsolete, reviewing payments, capital gains & losses and the list goes on…
“I can rest easy now,” you think “I’ve taken all the necessary actions and considered my obligations for the 2015/16 Financial Year. I can kick off my shoes, put my feet up and enjoy a break.”
Sorry! Not yet.
As a business owner you will need to take note of a number of key tax changes that apply from 1 July 2016 to ensure your business is not exposed to penalties or unnecessary cashflow pressures under these rules.
We have outlined the changes below with additional obligations, to provide you with an overview in preparation for the 2016/17 Financial Year:
- Small Business Entity (SBE) threshold turnover increased to $10 million, allowing greater ability to access tax concessions to improve cashflow, simplify reporting, and bring forward tax deductions
- SBE company tax rate reduces by 1% from 28.5% to 27.5% (turnover must be less than $10 million to be considered)
- Fringe benefits tax has been abolished on all portable electronic devices used for work, such as mobile phones, laptops and tablets. Exemption applies only to devices that perform substantially different functions restricting employees to one device
- Professional costs incurred in starting up a new business are immediately deductible. Before 1 July 2015, restrictions meant these costs had to be apportioned over a five year period
- New foreign resident capital gains withholding provisions now apply to certain transactions that are undertaken under contracts entered into from 1 July 2016
- The deadline for compliance with SuperStream requirements was 30 June 2016. However, the ATO is allowing some ‘compliance flexibility’ to small businesses (19 or fewer employees) that are not yet ready to implement the SuperStream requirements. This basically means while all businesses are technically required to comply with the new rules, the ATO will delay taking any compliance action against small businesses until 28 October 2016
Don’t let the complexities of today’s taxation system and changes in legislation cause you stress, we are here to offer you advice and ensure you are protected. Call us for a confidential, obligation free chat today.