THE BUDGET: The basics for us non-numbers folk

I am not a numbers man. I need to count my hours, pay my bills and juggle the accounts for a small business. But that does me. I don’t cope with much more than that.

The 2015 Australian government budget has just been delivered and I’ve heard it favours small business – Yay! But what does that mean? And how can I take advantage of it?

I thought I would outline as simply as possible my notes that may be helpful for all of us in small business:

1. Accelerated depreciation: As small businesses we will now get an immediate tax deduction for any individual assets we buy costing less than $20000.00. (Currently the threshhold sits at $1000.) This $20000 limit applies to each individual item. We can apply this $20000 rule to as many individual items as we wish. These arrangements start from budget night and continue until the end of June 2017. (Aust Govt Budget 2015)
So what does this mean in practice for me (and you)?… Instead of getting the 10% GST on the item back each BAS, small business can claim it back immediately.

2. Tax cuts: The Government is reducing the tax rate for more than 90% of incorporated businesses with annual turnover less than $2 million The company tax rate for these businesses will be reduced by 1.5% to 28.5%. To help all Australian small businesses grow, the Government will also provide a 5% tax discount to unincorporated businesses with annual turnover of less than $2 million from 1 July, 2015. (Aust Govt budget 2015)
So what does this mean in practice for me (and you)?… Mr/Mrs Accountant will take care of it… but it means a little bit more in your pocket at tax time… to build your business!

The Budget also noted that the Government would reduce red tape within the Fringe Benefits Tax; provide wage subsidies to support employment; provide assistance for employers to provide work experience for up to four weeks. Other headings listed in the budget dealing with jobs and small business are Youth employment strategy and Moving job seekers into work.

Conclusion: Most of these benefits will be handled by my accountant. Simple and done. No more numbers to worry about.

Although… I have also found it will be quite helpful having got my head around some of these benefits to factor them into budget planning and knowing how to be able to use the benefits most effectively.