Changes to small business tax concessions are now in place with the Mineral Resources Rent Tax being abolished this week. And the Australian Financial Review interviewed the ATO as to what these changes mean for small businesses around Australia.
So what are the things you should be aware when considering these small business tax changes:
- The instant tax write-off of assets under $6,500 cannot be claimed by Small Businesses from 1 January 2014. We wrote about this previously in our June tax update which means that assets can only be written off if they were purchased for under $1,000. “The Tax Office said it will only apply to assets acquired on or after January 1, 2014 “as such it will impact on the returns for the 2013-14 income year”, so if this $6,500 was claimed in your 2014 Income tax Return, an amendment will need to be processed.
- Loss carry-back allowed companies to use a current-year loss against taxable income in previous years, resulting in a refund for all or part of the tax value of the loss. Under the changes that will now be repealed , businesses were able to carry-back up to $1 million in losses each year and get back a $300,000 refund in subsequent years. These changes which are expected to be prospective will remove this concession.
You can read more about this article in the AFR here.
Photo courtesy of the Australian Financial Review.