These are my Top Three highlights from the Federal Budget for small business owners.
Income Tax Cuts
The Stage 3 personal income tax cuts will commence from 1 July 2024 as previously legislated. From 1 July 2024 the 32.5% marginal tax rate will be cut to 30% for the $45,000 to $200,000 tax bracket. The 37% tax bracket will be entirely abolished at this time.
That means middle & higher income earners will pay less tax.
Total Full Expensing of Assets
The Small business instant asset write-off (immediate tax deduction) threshold will be $20,000 for small businesses with aggregated annual turnover of less than $10m for assets that are first used or installed ready for use between 1 July 2023 and 30 June 2024.
That means you could consider making necessary large (>$20K) asset purchases before 30 June 2023. However, don’t fall into the trap of buying something just to get a tax deduction. That is, don’t spend a dollar to save 25c.
Payday Super
Employers will be required to pay their employees’ super guarantee at the same time as their salary and wages from 1 July 2026.
That means your payroll & super payment processes needs to be more efficient. Additionally you will need to budget (have funds available) to pay employee’s super every pay day.
Next Steps
Find out more about Beck Partners , Who We Are and What We Do at our website and feel free to contact info@beckpartners.com.au if we can be of any assistance.