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Federal budget update – summary for small business

Landserv and its staff are proud members of five Professional Associations and three business groups including the Geelong Chamber of Commerce. Managing Director Damien Chappell is a member of the Australian Institute of Company Directors. We also maintain certifications with three separate Certification Bodies including JasANZ and Exemplar Global.

The following summary of Federal Budget key features for Small Business is provided Courtesy of The Australian Institute of Company Directors:

Federal Budget 2015 – Key Features for Small Business (Courtesy of Australian Institute of Company Directors):

  • The company tax rate for incorporated businesses with annual turnover up to $2 million will fall by 1.5 percentage points to 28.5 per cent from 1 July, 2015. Unincorporated businesses such as sole traders and partnership structures with annual turnover up to $2 million will receive a 5 per cent tax discount, capped at $1000, through their year-end tax returns from 1 July, 2015. This will cost the Government $3.3 billion in the period to the end of the 2018-19 financial year.
  • A temporary measure will allow small businesses with turnover below $2 million to get an immediate tax deduction for every asset they acquire that is valued up to $20,000 for tax purposes – up from $1,000 previously. This will apply from Budget night until the end of June 2017 and cost $1.8 billion.
  • Capital gains tax rollover will be reformed to enable small business to change the legal structure of their business from the 2016-17 financial year without incurring capital gains tax. Rollover relief is currently available for individuals who incorporate but all other changes of entity type trigger a capital gains tax liability.
  • A fringe benefits tax (FBT) exemption will apply from 1 April, 2016 for all businesses with an aggregated annual turnover of less than $2 million that provide employees with more than one portable electronic device, even where the devices have substantially similar functions. Currently, an FBT exemption only applies to more than one device if the devices perform substantially different functions.
  • The Government will release a consultation paper later in 2015 on potential changes to the Corporations Act to reduce any unnecessary regulatory requirements for small business.

In a media release today the Geelong Chamber of Commerce Chief Executive, Bernadette Uzelac commented that the breadth of support measures included in the Budget was very encouraging and would leave many Geelong small business owners feeling that the government had finally acknowledged the important contribution they make to the economy.

“This budget recognises what the Geelong Chamber has known for many years – it’s small business that drives the economy, it is small business that drives jobs growth,” Ms Uzelac said.

“Small business is no longer the poor cousin, it is the engine room of a healthy economy and we are pleased to see the Government introduce both financial and practical measures that make it easier and more cost effective for people to run an existing small business or start a new enterprise.”