The announcement of the federal budget is always an interesting time for everyone in Australia. What’s included in the budget – or not included in it – has the potential to significantly impact our lives, especially for small business owners who have a range of different financial responsibilities and obligations.
Tax Cuts for Small Business Owners
Fortunately the 2016 federal budget is bringing some positive changes for small business owners this year, with the federal government focusing on improving the tax system so that it encourages “investment and enterprise”. In 2015 the federal government reduced the small business tax rate from 30% to 28.5% – making a significant dent in the tax payable by business owners turning over less than $2 million a year. This year Scott Morrison is cutting that tax rate again, bringing it down to 27.5% and increasing the eligibility requirements to businesses turning over less than ten million dollars a year. That’s a big win for small business owners around the country, including us franchisees!
Effectively the change means that 870,000 businesses across Australia will see a reduction in the tax they’re required to pay, and since those businesses are responsible for employing 3.4 million Australians, that’s a win for everybody. It’s an especially big deal for those businesses that fall into the $2 million to $10 million turnaround band, because they’ll be seeing a reduction in their tax rates for the first time in a while – they missed out completely last year so it’s great news for them.
The businesses in that $2 million to $10 million turnover bracket are also gaining access for the first time to the instant tax deduction for business equipment under $20,000 that was introduced last year for the smaller businesses, so if you’re in that tax bracket and you want to take advantage of the tax deduction now is the time to buy – you have until 30 June to get spending.
Thanking Business Owners for Contributing to the Economy
The franchising industry is a major employer of young people in Australia, and contributes significant amounts of revenue into the Australian economy each year, so it’s great to see that we are getting the support we deserve from the federal government for that contribution.
Do you want to start your own business and take advantage of some of the small business benefits offered by the Australian Government? Contact the Kwik Kopy franchise team today to find out how you can become a small business owner with one of the highest rated franchises in Australia.