That time of year again
- Cara Tobin
- 19 August 2008
What is your favourite time of year? Is it Christmas time? Easter time? Birthday time? Or is it (gasp) tax time?
Unless you have a grandmother like mine who divvies out her tax return evenly among all the grandchildren, I’m guessing it’s not tax time.
As a small business owner, what does the end of the financial year mean for you? Do you hand over receipt-stuffed envelopes to your accountant a week before the tax return deadline and beg him or her to take care of everything? Or are you a fiend for organisation and proactive-ness who has the route to your accountant’s office pre-planned and memorised?
Wherever you land on the anal retentive scale, this year you are going to find some differences at tax time. Or you can just take your accountant’s word for it.
According to accounting professional body CPA Australia, this year small businesses can access a whole range of concessions they couldn’t previously, thanks to a new set of rules just introduced by the Federal Government.
The changes include access to small business capital gains tax concessions, a fringe benefits tax car parking exemption and more flexibility for paying and reporting pay-as-you-go instalments and GST. There is also help at hand for start-up companies and micro-businesses, with up to 13 separate tax concessions to be claimed.
CPA Australia’s Senior Tax Counsel Mark Morris says the tax concessions are a boon for small business and a significant extension of the benefits previously available under the simplified tax system.
“Small businesses can obtain significant benefits by being able to write off any depreciating assets costing less than $1,000, and by pooling assets over $1,000 and depreciating at accelerated rates,” he says. “Businesses can also claim immediate deductions for certain prepaid expenses.”
Well, that certainly clears things up a bit.
Number crunching eludes me at the best of times but if my limited comprehension is correct, I can potentially pay less tax this year
In last month’s column, an open letter to the Minister for Small Business Dr Craig Emerson MP, I took a long, hard look at what the 2008 budget had in store for small businesses around Australia. One of the major talking points was tax cuts that left the average small business owner around $50 a week better off.
And if you are eligible, of course, you may be able to take advantage of even more savings.
It is a positive sign that the government is shifting the way it taxes small businesses. With so many horrendous things for non-accountants to think about, any simplification is greedily embraced.
The Australian Taxation Office has sensibly made its website fairly easy to follow and provided a hotline for advice and explanation.
My best advice this tax time, though, is to employ someone who actually understands the lingo and how to best harness the new system for your business. Number crunching eludes me at the best of times but if my limited comprehension is correct, I can potentially pay less tax this year. Eureka. Insert sigh here.
