The recent Federal Budget has brought a range of measures that you should take into consideration when planning for your business. Here's 8 key take-away you should consider:
- Temporary full expensing will cease 30 June 2023. If you were planning any vehicle or equipment purchases in the next few months - you should consider bringing the purchase forward. In order to access the immediate deduction for any purchases 30 June or prior - ensure the asset is installed and ready for use by 30 June.
- For the new financial year the $20,000 threshold for the instant asset write-off will be back in place. The $20,000 threshold will apply on a per asset basis. In addition small business asset pooling for depreciation will return. Small businesses with aggregated annual turnover below $10 million will be eligible.
- Considering energy saving upgrades? The new Small Business Energy Incentive will provide businesses with turnover less than $50 million with a bonus 20% tax deduction for eligible depreciating assets up to $100,000. A maximum of additional tax deduction of $20,000 per eligible entity will apply. Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024. Eligible assets will include upgrades to more efficient electrical goods such as energy-efficient fridges, assets that support electrification such as heat pumps and electric heating or cooling systems, and demand management assets such as batteries or thermal energy storage. Certain exclusions will apply such as electric vehicles, renewable electricity generation assets, capital works, and assets that are not connected to the electricity grid and use fossil fuels.
- Has the current financial year been a rough year resulting in losses - perhaps you could benefit from the loss carry back tax offset. Companies which paid tax in any of the prior years back to 2018-19 can carry back current year losses and generate a refundable tax offset.
- Effective cash flow management is always paramount for businesses employing staff Pay day will become more onerous with the introduction of ‘Payday Super’ from 1 July 2026. From this date employers will be required to pay their employees’ super at the same time as their salary and wages.
- Using your accountant or bookkeeper to assist with payroll? The Government are looking to further reduce the compliance burden around STP by allowing small businesses to permit authorisation for the lodgement of multiple Single Touch Payroll forms on their behalf. The provisions are due to apply from 1 July 2024.
- Did you get a bit behind on your lodgement obligations post Covid? A lodgement penalty amnesty program will be provided for small businesses with aggregated turnover of less than $10 million to encourage them to get their lodgements up to date. The amnesty will remit failure-to-lodge penalties for outstanding tax statements lodged in the period from 1 June 2023 to 31 December 2023, and that were originally due during the period from 1 December 2019 to 29 February 2022.
- Rising energy costs impacting your business cash flow? From July 2023, the government plans to deliver up to $650 for eligible small businesses. We note the total amount of bill relief will vary across our states and territories. For Qld businesses the relief will be provided for businesses that are separately metered on a business tariff and your business’s annual electricity consumption is less than the threshold of 100MWh. See here for further information.
Please be mindful that many of these provisions are not yet legislated. Contact our team of advisors should you have any questions regarding how these provisions will apply for your business.