The federal budget delivered on 6th October 2020 will help put small and medium businesses back where they belong: at the forefront of economic recovery as we continue to stand firm in the face of the COVID-19 pandemic. Here are the details:
Instant asset write-off extended The existing concession, to write off 100% of new asset purchases as an expense in the current tax year, has been extended and partly replaced by ‘temporary full expensing’ to 30th June 2022. Assets costing up to $150,000 each, purchased before the budget announcement, must be installed and ready for use by 30th June 2021 in order to become eligible for full write-off in the 2021 tax year. New assets purchased after the budget announcement, with no upper limit on cost, can be fully written off for tax purchases in the year they were installed and ready for use, until 30th June 2022. This includes the cost of any improvements to existing assets. Second-hand assets can be fully written off until June 2022 if your annual turnover is under $50 million. Fringe benefits tax concessions Employer-provided retraining (as opposed to further training for a current role), previously subject to fringe benefits tax, will be exempt from the tax from 2nd October 2020. This will help businesses retain and/or retrain employees whose roles have become redundant as a result of COVID-19. From 1st April 2021, on-site employee parking spaces previously subject to FBT, plus electronic devices provided to employees (e.g. phones and laptops), will be exempt from the tax for all businesses with an annual turnover below $50 million. Trainee and apprentice wage subsides From 1st July 2020 to 31st March 2021, businesses with fewer than 200 employees hiring a new or re-engaged apprentice or trainee will qualify for a 50% wage subsidy, worth up to $7,000 per quarter per employee. If you engage a new employee starting on or after 5th October 2020, the subsidy continues to 30th September 2021, capped at $27,000. This is an extension of the previous 50% subsidy scheme applicable only to businesses with fewer than 20 employees, in place from 1st January 2020 to 30th September 2020. JobMaker Focusing on getting young Australians into work, the government will give employers a credit for each new job they create for 16-to-35 year-olds. The details are:
$200 per week credit for 16-to-29-year-olds
$100 per week credit for 30-to-35-year-olds
Eligibility is limited to employees working a minimum of 20 hours per week who were receiving either JobSeeker, Youth Allowance or Parenting Payment for at least one month in the three months before they were hired. It’s all good news, but a bit complicated If you’re struggling to get your head around the budget details, your finance broker can connect you with more information sources. And if you need finance to help you take advantage of concessions and rebates on asset purchases and new employees, we have all the resources to hand. Contact us today.
Original post by Bank of Queensland