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2019/2020 Budget Highlights

This year’s budget announcement last night (2nd April 2019) was definitely set towards re-election. With exception for the increased investment in infrastructure, it’s a ‘safe’ budget.

We do however need to note – none of the budget announcements have been set in stone (i.e. legislated). This is because of the ever present threat of election announcement and the imminent care-taker mode in effect until the election is finalised. We have 6 weeks ahead to see what will truly happen.

In essence, the below is the highlights (in order of excitement) for business:

WHAT DOES IT MEAN FOR BUSINESS?

  1. Instant asset write off extended and increased (again) to $30,000 for businesses with turnover up to $50,000,000 turnover. This means you can buy a piece of equipment up to the value of $30,000 + GST and claim it 100% in your business tax return. See our video here on how it works.
  2. Company Tax Rate for small business will reduce to 25% by 1st July 2024. This means more money will stay in your business pockets allowing you to reinvest into the business for growth.
  3. Individual Income Tax Rebates will see a once off rebate for individuals up to $1,020 per person on the completion of their 2019 Tax Return. This means it’s important for you to get your tax returns completed on time (before 31 October 2019).
  4. Single Touch Payroll (STP) that is coming into effect for all business effective 1 July 2019 will also mean employees on Centrelink benefits will be cross referenced to your STP data. This will mean that reporting of wages to Centrelink will also become automated.
  5. Individual Income Tax Rates being reduced at the higher end over the next 5 years – so that the average rate of tax for individuals will be significantly reduced.
  6. Federal Government Contracts payment terms to small business on 7 day invoices. This will significantly improve cashflows for small business
  7. Pharmacies will see higher rebates on medication – reducing the cost to patients.
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