IS YOUR BUSINESS A SMALL BUSINESS ENTITY?

Small businesses can access a range of tax concessions from the ATO. To qualify as a
Small Business Entity, the business must have an aggregated turnover of less than $10
million and be operating for all or part of the 2019 year.

 

 

 

CHANGE TO COMPANY TAX RATE THRESHOLD

The company tax rate for businesses with less than $50 million turnover is now 27.5%.
(Previously <$10 million turnover)

 

 

 

INSTANT DEDUCTION FOR ASSETS LESS THAN $30,000
(PURCHASED AFTER 2 APRIL 2019)

You may be able to access an immediate deduction for depreciating assets.
There are three thresholds for the year ended 30th June 2019.

Date asset purchased Write off threshold Turnover Threshold
Pre 29th January 2019 $20,000 $10 million
29th January until before 7.30pm 2nd April 2019 $25,000 $10 million
From 7.30pm 2nd April 2019 onwards $30,000 $50 million

If you are  a small business entity (turnover < $10 million): Depreciating assets valued at more than
$30,000 will be depreciated in one pool at a rate of 15% in the first year and 30% in future years.

If your business turnover is between $10 million and $50 million, assets greater than $30,000 will be
subject to the general depreciation rules. Click here for more information.

 

 

SMALL BUSINESS ENTITY PREPAYMENTS

Small Business Entity taxpayers can make prepayments (up to 12 months) on expenses
(e.g. loan interest, rent, subscriptions) BEFORE 30 June 2019 and obtain a full tax deduction
in  the 2019 financial year.

 

 

BRING FORWARD EXPENSES

Purchase consumable items BEFORE 30 June 2019. These include marketing materials,
consumables,  stationery, printing, office and computer supplies. Spend the money now
and get the  deduction this year.

 

 

MAXIMISE DEDUCTIBLE SUPER CONTRIBUTIONS

The concessional superannuation cap for 2019 is $25,000 for all individuals. Do not
go over this limit or you will pay more tax! Note that employer super guarantee
contributions are included in this cap.

To claim a tax deduction in the 2019 financial year, you need to ensure that your
employee superannuation  payments are received by the superannuation
fund by 30 June 2019.
ATO Super Clearing House recommends payments be made by 24 June 2019

 

 

DEFER INCOME

 

If possible, defer issuing further invoices and receiving cash/debtor payments
until after June 30 2019. This strategy pushes tax payable into next year.

 

 

 

REPAIRS & MAINTENANCE

Make payments for repairs and maintenance BEFORE 30 June 2019.

 

 

 

DEFER INVESTMENT INCOME & CAPITAL GAINS

If possible, arrange for the receipt of Investment Income (e.g. interest on Term Deposits)
and the Contract Date for the sale of Capital Gains assets, to occur AFTER 30 June 2019.
The Contract Date is generally the key date for working out when a sale occurred, not  the
settlement date
.

 

 

MOTOR VEHICLE LOG BOOK

Ensure that you have a current log book (completed in the last 5 years). If you need a
new log book for the 2019 year it must be kept for at least a 12-week period and the
start  date for the 12-week period must be on or before 30 June 2019.

 

 

PRIVATE COMPANY (“DIV 7A”) LOANS

Business owners who have borrowed funds from their company in previous years must
ensure that the appropriate principal and interest repayments are made by 30 June  2019.
Current year loans must be either paid back in full or have a loan agreement entered into
before the due date of lodgement for the company return.

 

 

YEAR-END STOCK TAKE / WORK IN PROGRESS


If applicable, you need to prepare a detailed Stock Take and/or Work in Progress listing as
at 30 June 2019. Review your listing and write-off any obsolete or worthless stock items.

 

 

WRITE-OFF BAD DEBTS


Review your Trade Debtors listing and write-off all bad debts BEFORE 30 June 2019.

 

CHILDREN’S WAGES


Have your children worked in your business? If they have, ensure you have formalised
the arrangement (TFN declarations, etc.) and kept proper records of their work. Genuine
wages to children are taxed at ordinary rates.

 

 

 

TRUSTEE RESOLUTIONS

Ensure that the Trustee Resolutions are prepared and signed BEFORE 30 June 2019
for all Discretionary (“Family”) Trusts.