Small Business Entities (SBE)
Small businesses have access to a range of tax concessions. This applies to sole traders, partnerships, companies or trusts.
To qualify for these concessions, you'll need to check whether your business is a 'small business entity' for the year in question.
In general, to meet this requirement, your aggregated turnover must be less than $2 million.
Your aggregated turnover is your gross income or proceeds (rather than your net profit) for an income year. When working this out you need to:
include the annual turnover of any entity you are connected with or that is an affiliate of yours at any time during that income year
exclude any goods and services tax (GST) amounts you have charged on your sales.
You must review your eligibility each year.
The small business concessions include:
Income tax concessions
Capital gains tax (CGT) concessions
Pay as you go (PAYG) instalment concessions
GST and excise concessions
Fringe benefits tax (FBT) concession
One of the most exciting concession changes of recent times is the small business immediate write off for assets costing less than $20,000 each.
Small businesses can immediately deduct the business portion of most assets if they cost less than $20,000 and were purchased between 7:30pm 12 May 2015 and 30 June 2017.
This deduction can be used for each asset that costs less than $20,000, whether new or second-hand. The deduction is claimed through a tax return, in the year the asset was first used or installed ready for use.
From 1 July 2017, the threshold will return to $1,000.