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The Treasurer Jim Chalmers handed down the Federal Budget in May, with a view of reducing cost of living pressures.
Titled ‘Stronger Foundations for a Better Future’, the budget includes initiatives that may impact you as a small business owner.
Energy costs
Firstly, $3 billion is being directed to small businesses and households to deliver relief from the rising price of energy. As a small business, the amount you will be eligible for varies by state. In Queensland, for example, eligible small businesses will be able to access a one-time rebate of up to $650 on energy costs.
In addition to this, small and medium businesses that turnover less than $50 million annually and invest in energy-efficient systems will find themselves eligible for boosted tax deductions. The amount your business can spend on eligible assets for electrification and increased energy efficiency is capped at $100,000.
Instant asset write off
There was talk that the instant asset write-off scheme would be rolled back but instead it has been relaunched for eligible businesses that make purchases up to $20,000.
This is another ‘use it or lose it’ initiative; it’s only expected to be valid throughout the next financial year. The May Federal Budget also updated the eligibility criteria, so the instant asset write off now only applies to businesses with a turnover of less than $10 million.
If you turnover more than this amount and you want to buy a new vehicle for your business, try to get in before the end of this financial year.
Tax and super
The Australian Tax Office will receive a $588 million boost over four years to improve GST compliance among businesses. This will include the development of analytical tools that can help the department identify wrongdoers.
In addition to this, there will be an amnesty on late lodgment penalties. The Australian Taxation Office will remit failure-to-lodge penalties for some small businesses with an aggregate turnover of less than $10 million. Keeping in mind that businesses are still recovering after COVID, the amnesty dates back to December 2019. It is aimed at encouraging businesses to engage with the ATO to find ways to resolve tax debts.
If you have been avoiding sitting down and going over your tax return, this amnesty gives you an opportunity to work with your accountant and get things on the right track.
Finally, the government will aim to reduce unpaid super by aligning the payment of superannuation and wages. In the past, super payments were required on a quarterly basis.
They will now line up with employee wage payments, which is something to discuss with your bookkeeper and accountant.
International Student working hours
If you employ international student workers, this may affect you?
During the pandemic, the cap on the number of hours international students can work was lifted. It is now set to be reinstated at 48 hours per fortnight, which is slightly higher than pre-pandemic restrictions but may change your rostering requirements.
Those working in the aged care sector however will be exempt from this change until 31 December 2023. The cap on the number of hours students can work won’t apply until the end of the year.
Cyber support
The budget allocated over $23 million in funds to go towards the Small Business Cyber wardens program, which is focused on improving digital resiliency and cybersecurity for the SME sector. This is aimed at helping small businesses to protect themselves from cyber security breaches and will be overseen by the Council of Small Business Organisations Australia (COSBOA).
Apprenticeships
If your business is in a male-dominated industry, you may benefit from funding that has been put towards making worksites more inclusive.
The Government says it has put aside $8.6 million to deliver the Australian Skills Guarantee and introduce national targets for women apprentices, trainees and paid cadets working on Australian Government funded major construction and ICT projects. This includes new targets to double the proportion of women in apprenticeships and within the trade sector.
Support for innovation
$392 million has been assigned to launch the Industry Growth Program. The initiative will help eligible small businesses and startups with turnovers of under $5 million to commercialise their concepts and expand their operations.
The Federal Budget always brings changes that affect Australian business owners. If you need help to review your own business budget, find out what grants, rebates and tax breaks you may be eligible for and understand how to be tax compliant, contact Crest Accountants today.
