Business Taxation

The past number of years has seen substantial changes by the ATO regarding small business and the concessions that are available to them. The Simplified Tax System (STS) has allowed an accelerated depreciation method as well as numerous incentives such as the Entrepreneur’s Tax Offset and capital gains concessions which have provided tax planning opportunities like never before.

Today, more than ever, business taxation is not just a statutory duty… it is a critical part of your business strategy that is as important as both your business and marketing plans.

Business taxation is not simply about what you have done in the past twelve months… it includes what you are aiming to achieve in the future. Unless this factor is involved, your business will be severely limited in how it will grow.

Goods and Services Tax

On July 1st 2000 a new taxation system was implemented in Australia featuring what we now know as the Goods and Service Tax (GST).

The Australian Taxation Office initially took a stance of light compliance, allowing tax payers and businesses time to become accustomed to the new system. However, since 2004 the ATO has stepped up its compliance program in regard to both GST and income tax reporting claiming that the Australian taxpayers and businesses should now be fully aware of their respective reporting obligations.

Any profit based business with a turnover of $50,000 or over (from 1 July 2007 this has been raised to $75,000) is expected to report, in many cases quarterly, their sales and expenses that include GST and make payment on their GST liability.

Failure to comply will incur heavy fines for non-lodgement and interest charges for non-payment.

Although the GST system has been part of our business culture for a few years now, many small business owners still struggle to maintain the strict requirements placed on them. Time restraints, personnel limitations and outsourcing costs have made GST compliance a costly activity of which they have no choice but to participate in if they wish to trade.