Small business tax cuts start 1 July 2020

The Government has reminded that, as the 2020/21 financial year begins, incorporated small and family businesses with a turnover of less than $50m will see their company tax rate reduced from 27.5% to 26%.

Unincorporated businesses will also benefit as the rate of the small business income tax offset increases from 8% to 13%.

The changes mark the next stage of the Government’s accelerated small business tax cuts, legislated in October 2018, which brought forward tax relief for small and medium businesses by five years.

The Minister for Employment, Skills, Small and Family Business, Michaelia Cash, identified small businesses as the backbone of our economy with around 3.5m small businesses across the country, stating that small businesses are a vital part of our COVID-19 recovery.

The Treasurer said these legislated tax cuts would provide further support to small business during the COVID-19 crisis, in addition to the extension of the Instant Asset Write Off to $150,000 for another six months, the Cash Flow Boost of up to $100,000 for employing small businesses and the boost to accessing capital through the COVID-19 SME Guarantee Scheme.

The Money Edge | Bundaberg