With a change in government comes change in policies that affects each one of us directly or indirectly.
Below are some of the Coalition's potential tax policy changes that would affect small businesses:
- Removal of the carbon tax. This is likely to ease the pressure of rising costs of businesses
- Cut of 1.5% in the company tax rate to 28.5% from 1 July 2015 - as any tax paid by a company is eventually claimed back as franking credits when the profit is distributed to shareholders as dividends this would just be a timing difference and not affect small businesses in the long run.
- 1.5% levy on companies with taxable income above $5 Million to fund to its Paid Parental Leave Scheme.
- No increase in GST.
- Removal of Labor’s policy to abolish the statutory formula for calculation of Fringe Benefits Tax on motor vehicles. This would take things back to way they were and help businesses keep the paperwork down.
- Changes to the $6,500 instant asset write-off and the accelerated depreciation for motor vehicles. Over the long term it does not affect small businesses as this just slows down the depreciation/write off, the claim would still be the same over the life of the asset.
- Discontinuing the tax-loss carry-back measure.
- The paymaster requirement for parental leave is due to be removed
By SURESH RAJANI
Suresh Rajani is the Business Leader at TAX FIRST (NSW) & TAX FIRST (SA) - accounting and business advisory firms located in Sydney and Adelaide.
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