Taxation Matters

The company tax rate for “eligible small business companies” will be reduced to 28% from 2012/13 (ie two years earlier than for other companies).

The government will consult on the exposure draft legislation, including on instalment and franking arrangements.

The government has announced that the company tax rate will be reduced to 29% from 2013/14, and to 28% from 2014/15.

It was recommended in the AFTS Report that the company tax rate be reduced to 25% over the short to medium term, with the timing subject to economic and fiscal circumstances (Rec 27).

On Sunday 2 May, the government publicly released the Henry tax review and its initial response. Although the Henry tax review contains recommendations to reform Australia's tax system, the government has initially focused on the resources sector and superannuation. The company tax rate is also to be reduced and there are some benefits for small business.

Your tax questions answered

Complimentary Webinar: Tuesday June 1 at 2pm AEST

With just over a month left until June 30, entrepreneurs are scrambling to be ready for one of the most stressful events of the year – tax time. With this in mind, SmartCompany has asked tax expert Greg Hayes of Hayes Knight to answer your big tax questions. When you register for this webinar, we‘ll give you the opportunity to leave a question for Greg, who will answer the 10 most frequently asked questions plus as many others as possible.

Now that the countdown to the end of the financial year is only weeks away, SMEs should consider the tax deductions and incentives available and analyse whether they can take advantage of them.

Countless small business owners, depending upon their circumstances, may have some powerful reasons to feel relieved. The Government hasn't picked up any of the Henry Tax Review's proposals that could have effectively cutback on the best tax breaks of all for small business owners – the CGT small business concessions.

Small businesses have welcomed the Government's proposal to allow them to immediately write-off assets worth less than $5,000, with accountants saying the move will provide tax benefits for thousands of firms.

But experts have also warned the proposal will only apply to companies, so businesses run by either a sole trader or under a trust-type structure will be unable to claim either the write-off allowance, or benefit from the cut in the corporate tax rate to 28%.

For many industry groups the Henry Tax Review was a real mixed bag – actual Government policy changes were fairly thin on the ground, so many groups will need to wade through Henry's Review to find out what's been missed and what could be lobbied for.

Complimentary Webinar: Thursday May 20 at 2pm AEST

It's the time of the year that every business owner dreads - tax time. But don't panic, there is still plenty of time to get your tax strategy in place and make the end of financial year a little less stressful.

Complimentary Webinar: Wednesday May 5 at 2pm AEST

The long awaited Henry Review was released on Sunday, May 2.