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2016 Federal budget – what you need to know

2016 Federal budget – what you need to know (Last Updated On: October 23, 2018)

The Federal budget was released last night, with some good news for small to medium enterprises (SMEs). Employsure has taken a look at how the Federal budget announcement affects SMEs, its key aspects and what you, as an employer, need to know.

Tax breaks

The Federal Government has focused on tax cuts for businesses as one of the key highlights of this year’s Federal budget.

The small business tax rate will now be lowered by 1% to 27.5% from 1 July 2016. The turnover threshold to access this tax rate will be increased from $2 million to $10 million. In coming years, this tax rate will become accessible to even more businesses, with the threshold increasing each year.

Unincorporated small businesses will also benefit from this budget, with an increase to their tax discount from 5% to 8%, and the turnover threshold extended from $2 million to less than $5 million.

In more good news for SMEs, businesses with a turnover of less than $10 million will be presented with Pay-As-You-Go installment payment options, along with additional tax incentives such as small business depreciation pooling provisions.

Business equipment

An extension has been applied to the 30 June 2017 deadline on all instant write-off equipment purchases. In addition, small businesses with a turnover of less than $10 million can benefit, as they will now be eligible for the instant tax write-off for purchases up to $20,000 made in the 2016/2017 financial year.

Employment of young people

Following a four week volunteer work experience venture, for those who have just completed high school or university (working a maximum of 25 hours per week), employers who then offer that person a paid position can access wage subsidies of up to $6,500 in the first 12 months of employment.

Restart program

Businesses who participate in the restart program, which encourages participation of over 50s in the workforce, may be able to access a wage subsidy of up to $10,000 over 12 months (reduced from 24 months) for such employees who have been unemployed for more than six months.

Employsure can assist with any concerns or confusion you may have in regards to your business and the Federal budget. Our team of specialists are always on hand to help so call us today on 1300 651 415.

Sourced from ABC News and Commonwealth Bank Australia

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