A wave of more favourable tax treatments are due to hit small business from 1 July 2012 (Confirmed by the Budget!).
You may want to keep these in mind if you are in the market (or planning) to buy an asset (or some) in the short term.
- The Government will provide Australian small businesses with an instant tax write-off of the first $5,000 of any motor vehicle purchased from 2012-13. The remainder of the purchase value can be transferred into the general small business depreciation pool, which is depreciated at 15% in the first year and 30% in later years.
- An immediate write-off of all assets valued at under $6,500 (up from $1,000 presently)
- A write-off of all other assets (except buildings) in a single depreciation pool at a rate of 30%
A reduction in company tax rate. The changes will result in a small business company tax rate of 29% from 2012-13 onwards. To be eligible to access this lower rate in 2012-13, the aggregated turnover of the small business for that year must be less than $2 million.< Scrapped by the Budget
These reforms will be available to all small businesses, including sole traders and businesses operating through trusts, partnerships and companies.
Further information and detailed examples should be available in June or July.
For now, it is worth noting they are in the pipeline and due to commence from 1 July 2012. To confirm, these changes are due to commence from 1 July for assets purchased from 1 July and NOT at the moment.