Small businesses, jobs and families were front and centre in the 2015/16 Federal budget, which according to budget.gov.au, has been developed to ensure a safe, secure and prosperous future for Australia. What does that mean for you? Below, we take a look at the key announcements we believe will impact Etlanda clients.
Small business owners (defined as businesses with aggregated annual turnover of less than $2m)
- From 1 July, companies with annual turnover of less than $2m will have their tax rate lowered from 30% to 28.5%.
- From 7:30pm on 12 May, 2015 until 30 June, 2017, small businesses can claim an immediate tax deduction for “each and every item” purchased up to the value of $20,000. Currently the threshold sits at $1,000.
- Assets valued at $20,000 or more can continue to be placed into the small business simplified depreciation ‘pool’ and depreciated at 15% in the first income year and 30% each income year after.
- There will be an annual 5% tax discount of up to $1,000 a year for unincorporated businesses – these are small businesses which are not run as a separate legal entity.
- From 1 July, the three-year holding period on employee share allocations can be waived by the Commissioner of Taxation if there are circumstances outside of the employee’s control that require them to sell their shares.
- From 1 July 2016, small business will be able to change the structure of their business, such as moving from a sole trader to a trust, without incurring CGT liability.
- From 1 April 2016, the government will allow an FBT exemption for small business that provide employees with more than one work-related portable electronic devices such as mobile phones, laptops and tablets.
Changes to age pension eligibility
- The asset test thresholds will increase for a single person to less than $250,000 (currently $202,000) and for a pensioner couple to less than $375,000 (currently $286,000).
- Non-home owner pensioners will also benefit by an increase in their threshold to $200,000 more than home owner pensioners.
- The ‘taper rate’ at which age pension begins to phase out will be increased from $1.50 to $3.00 for every $1,000 of assets over the relevant assets test threshold.
- Pensioners who lost entitlements will be automatically issued with a Commonwealth Seniors Health Card or a Health Care Card (for those who are under Age Pension age).
- From 1 July 2016, access to parental leave pay will be limited to individuals whose employer does not provide parental leave entitlements, meaning families can no longer ‘double dip’ from both the government and their employer.
- From 1 July 2017, families will be able to access a single Child Care Subsidy which will assist low-income families earning $65,000 or less with 85% of their child care fees, up to an hourly cap. The subsidy tapers to 50% for families earning less than $185,000 and those earning more than $185,000 will have a $10,000 annual cap.
- Families who find it difficult to access regular child care services and earn less than $250,000 can apply to participate in The Nannies Trial which will pay for 4,000 nannies across Australia between 1 January 2016 and 31 December 2017.
- From 1 January 2016, families who choose not to vaccinate their children will no longer be able to receive child care payments or the Family Tax Benefit Part A.
For a full list of 2015/16 Federal Budget Papers click here
If you have any questions about how these changes will impact you or your business, don’t hesitate to get in touch with us by phone: 02 9728 3885.