Tax time is fast approaching
Do you know what tax concessions apply to your small business?
Although it might seem like we’ve only just said goodbye to the summer heat, the end of financial year is nearly here. There are a number of tax initiatives to assist small business this financial year.
$20,000 instant asset write-off
The small business $20,000 instant asset write-off still applies until 30 June 2019. This means if your annual total turnover is less than $10 million, you can instantly claim back the cost of most business assets up to $20,000.
For example, if you own a cafe and buy a new coffee machine for $14,000, the entire cost of the machine can be claimed on your tax return.
Only the business portion of the asset can be claimed, so if a small business owner purchases a laptop for $5,000, and uses it for personal use 50% of the time, $2,500 can be claimed.
There is no limit to the number of claims on assets under $20,000. Assets totalling $20,000 or more can be put into a small business asset pool where you can claim a proportion of the amount as a deduction each year.
Other tax concessions
If you are a sole trader or have a share of net small business income from a partnership or trust, and the business has an aggregated turnover of less than $5 million, you can claim the small business tax offset, up to $1,000.
If you’re starting up a small business, you can immediately deduct certain professional expenses incurred in establishing your new businesss. This can include the costs for professional, legal and accounting advice.