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Effective from 1 July 2016 the tax concession rules for small businesses have changed. Following are some of the key changes that will apply from the 2017 tax return.:

  • Company tax rate cut: The company tax rate for small businesses has decreased from 30% to 27.5%. Companies with turnover less than $10 million are eligible for this rate.
  • Increase in small business income tax offset: The offset has increased from 5% to 8%, capped at $1,000 per year. Only businesses with a turnover of less than $5 million are eligible and the offset applies only to business income for sole traders, or share of business income for partnerships or trusts.
  • Increase in small business turnover threshold: The threshold has increased from $2 million to $10 million. This means more businesses can access a range of small business concessions, including the $20,000 instant asset write-off for the 2016-17 income year.
  • If you are a business with 19 or fewer employees, or have an annual aggregated turnover of $2 million or less, you can make your super guarantee (SG) contributions as a single electronic payment to the Clearing House and it will distribute the payments to employees’ funds. Here’s the link: Small Business Superannuation Clearing House
  • Superannuation Rate: The minimum super you must pay each quarter for each eligible employee is called the super guarantee (SG). Currently the SG is 9.5% of their ordinary time earnings (OTE).
  • Quarterly Super Due Dates
QuarterPeriodPayment due date
11 July – 30 September28 October
21 October – 31 December28 January
31 January – 31 March28 April
41 April – 30 June28 July
  • While the SG contribution for the June quarter is not due till the 28th July, in order to get the income tax deduction in a given financial year the payment should be made before 30 June.
  • Concessional before-tax super contributions: You may voluntarily contribute additional amounts to your super subject to the following concessional caps. Concessional contributions are taxed at the 15% rate.
Financial yearAgeConcessional cap
2017-18Any age$25,000
2016-17Less than 49 on 30-Jun-16$30,000
2016-1749 or older on 30-Jun-16$35,000
  • Registration Deadline: The deadline for lodging an application for registration is 10 months after the end of a company’s income year. This means a company with income period of 1 July 2015 to 30 June 2016 must lodge its registration application with AusIndustry by 30 April 2017
  • The tax benefit that companies will receive from the R&D tax offset for the 2016-17 tax year is outlined in the table below
Group
Turnover
Company Tax
Rate
R&D Tax
Offset Rate
Tax Discount
Percentage
Refundable or
Non-refundable
Less than $10 m27.5%43.5%16%Refundable
Between $10m - $20m30%43.5%13.5%Refundable
$20m or more30%38.5%8.5%Non-refundable

Eligible investors in Early Stage Innovation Companies (“ESIC”) are eligible for:

  • A 20% non-refundable carry-forward tax offset, up to $200,000 per investor, per year; and
  • A capital gains tax exemption for shares which are held for more than 12 months but less than 10 years. For shares held for more than 10 years, the cost base of those shares will be their market value as determined on the 10 year anniversary date. Capital losses (whether the shares are held for more or less than 12 months) must be disregarded.

A company will qualify as an Early Stage Innovation Company (“ESIC”) if it meets both:

  1. the early stage test; and
  2. either the 100-point innovation test or principles-based innovation test.

To satisfy the early stage test, a company must pass four tests:

  • Incorporated in Australia within the last 3 years, or if not, within the last 6 years provided that expenses do not exceed $1 million in total across the last 3 years;
  • Expenses < $1 million in the previous income year;
  • Assessable income < $200,000 in the previous income year; and
  • Not listed on any stock exchange.

Tax Withheld for Individuals (PAYG) Calculator

This tool will help you calculate the amount of tax to be withheld from your employee’s gross salary

Employee share scheme (ESS) calculator

This tool will help you calculate the discount amount of the unlisted rights and underlying shares acquired under an employee share scheme

Stamp Duty on Transfer of Shares Calculator (NSW)

This calculator will estimate the amount of duty you need to pay on the transfer of shares in an unlisted company incorporated in NSW or units in an unlisted unit trust scheme registered in NSW.

Land Tax Calculator (NSW)

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