Keeping up to date with the current changes in Government Legislation requires accountants to start tax planning early to stay ahead of the game. It has been 12 months since the COVID-19 Pandemic caused enormous change in the accounting field, prompting professionals to review the many incentives and stimulus measures introduced to support business during the pandemic.
It is worth noting that the that the tax rate for corporate entities has dropped to 26% for small to medium sized businesses for the 2021 financial year, with the rate decreasing further to 25% in the following financial year. Tax rates will also be reducing for sole traders.
As of 1 April, small to medium sized businesses will also be eligible for FBT exemptions for car parking benefits and work-related portable devices.
The exemption from STP reporting for small employers with closely held payees ends on 30 June 2021. Closely held payees include family members of a family business, directors of a company, and shareholders or beneficiaries.
The generous tax concessions for small businesses are also changing, whereas the $150,000 instant asset write off has reverted to $1,000 from 1 January 2021. This will not have any practical effect until 1 July 2022, due to the current full expensing of depreciating assets measure.
To see if these changes will affect your business, or to start your 2021 tax planning, follow the link and one of our dedicated team members can assist you.