If you thought you get a lot of information sent to you about the budget, just imagine how much we get as Accountants. Sometimes working out what will really affect you is hard to do so here are the key items we believe will impact small business budget:
$20,000 ASSET WRITE OFF HAS BEEN EXTENDED FOR ANOTHER 12 MONTHS FOR SMALL BUSINESSES
This means the acquisition of an asset used in your business can be immediately claimed as a tax deduction if it costs less than $20K (ex GST). This measure has been in place for a couple of years now and has been extended another 12 months.
NO MORE SALARY AND WAGE TAX DEDUCTIONS FOR LATE PAYING EMPLOYERS
From 1 July 2019, late payment of PAYG obligations will mean the employer cannot claim a tax deduction for the payment to the employee (eg wages). This is also to include payments made to contractors where the contractor has not provided an ABN and the business did not withhold PAYG.
$10,000 CASH LIMIT FOR ALL BUSINESS TRANSACTIONS
We now have an imposition on cash transactions, in that business is not allowed to accept cash payments of more than $10,000 per transaction from 1 July 2019. This measure does not impact on non-business transactions (so consumer to consumer) or transactions with financial institutions.
GST NOW INCLUDED IN DIRECTOR PENALTY NOTICES
Currently, under certain circumstances, directors can be held personally liable for unpaid superannuation guarantee and PAYG withholding amounts. The budget proposes to extend this to include GST, luxury car tax, and wine equalization tax, making directors personally liable for the company’s debts. Along with this, directors will be prevented from improperly backdating resignations to avoid liability or prosecution.
3 YEAR CYCLE FOR SMSF AUDITS
For compliant self-managed super funds, the audit requirements will drop to a 3-year cycle, rather than the current annual audit requirement.
PERSONAL TAX CUT
Personal tax rates will slowly change over the next 7 years, with the first change taking effect from 1 July 2018. This first change will see the 32.5% tax bracket broadened to those earning up to $90,000 (up from $87,000)