For the 2016-17 financial year, the small business concession eligibility has changed.
From 1 July 2016, you are a small business entity if you are a sole trader, partnership, company or trust that:
- Operates a business for all or part of the income year; AND
- Has an aggregated turnover less than $10 million.
The $10 million turnover threshold applies to most concessions, except for:
- The small business income tax offset, which has a $5 million turnover threshold
- The capital gains tax (CGT) concessions, which continue to have a $2 million turnover threshold.
The full list of concessions available can be found on the ATO website, and include the following:
- Simpler depreciation rules – in particular, assets purchased during the 2016-17 year costing less than $20,000 can be immediately written off rather than depreciating over its effective life
- Company tax rate of 27.5% for the 2016-17 year
- Immediate deduction for prepaid expenses
- Simplified trading stock rules
It should be noted that from 1 July 2017, the concessional contribution cap will be reduced to $25,000, regardless of ages. READ MORE
For high income earners, where the adjusted taxable income exceeds $300,000, Division 293 tax will be applied on concessional contributions. The Division 293 tax is applied to certain super contribution to reduce the concessional tax treatment, that is an additional 15% tax. Note from the 2017-18 year onwards, the new threshold amount will be reduced to $250,000.
Do you have all the information and documents that are needed to complete your 2016/17 tax return? Checkout our tax time checklist 2017