2020 Federal Budget Breakdown
Tanushree Mitra2021-12-08T11:26:24+09:30
By Tanushree Mitra Accounting, Finance, General, News, Small Business 0 Comments
On Tuesday 6th October 2020, Treasurer Josh Frydenberg delivered a budget that aims to jumpstart the economy, as we move through the uncertain times COVID has created. There's a lot to take in, so we've highlighted the Federal Budget changes that will benefit small business almost immediately.
Instant asset write-off extension:
The Government has extended the instant asset write off that had already been expanded, so small businesses can claim a tax deduction for the full value of assets purchased until 30th June 2022, rather than claim depreciation amounts over several years. Find out if you're eligible.
Temporary full expensing to support investment and jobs:
Small businesses (aggregated turnover less than $10 million) can deduct the balance of their simplified depreciation pool at the end of the income year, while full expensing applies. Find out more about simplified depreciation.
JobMaker Hiring Credit (wage subsidy scheme):
Eligible employers will have access to a JobMaker Hiring Credit for each new job they create over the 12 months from 7 October 2020, for which they hire an eligible employee, for a maximum claim period of 12 months from their employment start date. Employers who hire eligible young people aged 16 to 29 will receive $200 a week, or $100 a week if aged between 30 to 35. Find out more.
National Digitisation Plan:
$800 million has been pledged to help businesses take advantage of digital technology as part of the wider Digital Transformation Strategy. Part of this budget will be utilised to create a national directory which will enable small businesses to register for an ABN, ACN or a licence in just one place. Around $52 million is also earmarked for cyber-security and digital capability program that will help small business.
Small business tax concessions:
Tax concessions currently available to small business with annual turnover up to $10 million have been extended to businesses with turnover up to $50 million. These concessions will be rolled out in three phases:
From 1 July 2020, eligible businesses will be able to immediately deduct certain start-up expenses and certain prepaid expenditure.
From 1 April 2021, eligible businesses will be exempt from the 47 per cent fringe benefits tax on car parking and multiple work-related portable electronic devices, such as phones or laptops, provided to employees.
From 1 July 2021, eligible businesses will be able to access the simplified trading stock rules, remit pay-as-you-go (PAYG) instalments based on GDP adjusted notional tax and settle excise duty and excise-equivalent customs duty monthly on eligible goods.
Eligible businesses will also have a two-year amendment period apply to income tax assessments for income years starting from 1 July 2021, excluding entities that have significant international tax dealings or particularly complex affairs.
From 1 July 2021, the Commissioner of Taxation's power to create a simplified accounting method determination for GST purposes will be expanded to apply to businesses below the $50 million aggregated annual turnover threshold.
Mental health aid for small business owners:
Government will provide $6.5 million in 2020-21 to support mental health and wellbeing of small businesses impacted by COVID-19. This includes a $4.3 million budget commitment to Beyond Blue's NewAccess for Small Business service, which will provide small business owners with free one-on-one telehealth sessions with trained mental health coaches from early next year.
Personal income tax cuts fast tracked:
Tax cuts scheduled to start in July 2022, have been brought forward and will be backdated to July 2020 to deliver an immediate boost to household budgets. It is expected to boost future spending on goods and services across all businesses, including SMEs.
Insolvency reforms to support small business:
On the 24 September 2020, the Government announced changes to Australia's insolvency framework to better serve Australian small businesses, their creditors and their employees. The proposed changes will enable more Australian small businesses to quickly restructure. Where restructure is not possible, businesses will be able to wind up faster, enabling greater returns for creditors and employees. Find out more.
2020 has been a year of hardship, resilience, and now rebuilding. The focus of this year's federal budget is on hiring, investment and spending. The aim is to encourage businesses and households to take advantage of the new programs, to build a healthy economy, and provide more jobs. It is now time to start the journey towards recovery.
Get the full federal budget breakdown.
Tanushree Mitra
Tanushree is the Marketing Manager at Cashflow Manager, crafting strategies across various advertising verticals, including Digital, ATL, Social-media, Content and Creative. With more than a decade of experience in management and SME positions across finance, insurance, motoring and media-publishing sectors (both in Australia and in India), she's a stickler for excellence and ensures our brand message is strong and consistent across all marketing efforts and customer touch-points. A double Masters, majoring in Marketing, including an MBA, she's all about marketing strategies driven by sound data analysis and insights to drive market penetration and growth.
How will the abolition of the 457 visa impact small business?
This week, the Australian Government pledged to remove and replace the 457 visa entirely, so what will this mean if you run a small business that relies on this [...]
Business Planning: Goals and Objectives
Goals and objectives steer a new business in the right direction and help to keep an existing business on the right track. Think about it, you need a final [...]
Easy accounting software frees up your volunteers' hands
Volunteers are the lifeblood of any not-for-profit organisation and without them things just wouldn't happen. But unfortunately you probably face a revolving door of new committees and treasurers most [...]
The top 10 mistakes in DIY bookkeeping
It's time to put your bookkeeping processes under the microscope again as we draw closer to the end of financial year. It seems that bookkeeping is either a task left [...]
Fringe benefits tax – what small business owners need to know
As a small business owner, you need a good understanding of which taxes apply to you right from the start. One tax that can be incredibly confusing for business [...]
The great GST debate 20 years on
It has been more than 20 years since the GST was introduced in Australia, and despite all the fears about how we would work out how much to pay [...]
4 reasons you should be updating your accounting software regularly
As the new year begins our thoughts usually turn to new beginnings and making resolutions. It's a way of promising ourselves to improve in year ahead. That applies as [...]
How to manage and embrace change in turbulent times
The new "working-from-home economy" is predicted to continue long past the pandemic that prompted it. That's not all: e-commerce has likely changed forever as online shopping boomed during lockdowns; [...]
Top Tips for Keeping Healthy in the Workplace
Keeping healthy at work after sitting at your desk for over 8 hours a day, is a challenge. It takes its toll on both your physical and mental health. [...]