Important year end tax planning information
With the 30 June just weeks away there are numerous things to consider for small businesses, trustees of discretionary trusts and companies in general. Here are a few of the main ones:
- Small Business Entities (Aggregated turnover of <$2 Million) can get an immediate write-off for assets costing < $20,000 (excl GST). If you are in need of some new equipment costing less than $20,000 then now might be the time to act, particularly if you’ve had a good year income wise.
- Businesses with turnover between $2 Million and $10 Million may wish to defer asset purchases (<$20,000) until after 30 June 2016 as they will then become Small Business Entities under the recently announced budget proposals.
- If you have a discretionary trust the trustees need to consider which beneficiaries they will make presently entitled to the income or capital of the trust before 30 June 2016 in accordance with the trust deed.
- Superannuation must be paid before 30 June 2016 to ensure a deduction in this year.
- Bad debt deductions — If you have doubtful debts, you can possibly bring forward deductions if you are able to write those amounts off as bad debts for tax purposes before 30 June 2016
- Small business tax rates — Corporate beneficiaries of small businesses operated through trusts may not be eligible for the reduced rate of tax of 28.5% (for the year ending 30 June 2016) or 27.5% (for the year ending 30 June 2017), which may otherwise be available to small businesses that operate through corporate structures. You should consider whether your business structure is appropriate, particularly with the Small business restructure roll-over provision which start on 1 July 2016.
To discuss how this may impact your circumstances please contact PPT on (03) 5331 3711.
DISCLAIMER: The material and contents provided in this publication are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained.
