There has been much talk about the 2014 budget, but what does it all mean for the small to medium business owner (SME owner). The changes in the budget may affect your business directly through company tax, entrepreneurs program and the over 50s payment. Your business could also be affected indirectly through the deficit tax and increase in fuel prices.
The company tax has been lowered from 30% to 28.5%. There is however, a 1.5% levy to be applied on taxable income exceeding $5 million. This is good news for small businesses who have under $5 million in taxable income.
Entrepreneurs’ Infrastructure Program
This program will dedicate $484.2 million to assist entrepreneurs when starting up their business. Entrepreneurs will be able to apply for up to $20,000 start up loans to help commercialise good ideas. It also aims to improve the capabilities of SME and streamline their access to government programs.
Over 50s Payment
A cash incentive will be offered to an SME who employs people aged 50 and over. The company will receive an initial $3,000, followed by a second$3,000 if they keep them employed for 12 months, another $2,000 will be given to those who keep over 50s employed for 18 months, and then a final $2,000 if they are employed for over 2 years.
The deficit levy will be applied to people who earn over $180,000 p.a. The levy is set at 2% of their total annual income from July 2014 to 2017. This may affect you as the SME if you earn over $180,000.
Fuel prices are set to increase with inflation, to raise $2.2 billion in revenue by 2018. This will come into play from 1 August 2014 and will occur twice yearly. There is no set price by which it will increase by. This will not only affect motorists, but will also affect SMEs. It may increase your logistics costs, which means you may have to increase prices for your customers, and other businesses may increase their prices, making it more expensive for you to purchase goods.
There have been many changes made in the 2013 budget; some affecting SMEs. If you have any questions about how the 2013 budget could affect your small business, or for any other accounting or taxation advice, please contact the experienced team of accountants and tax agents here at The Quinn Group by submitting an online enquiry or calling us on 1300 QUINNS (784 667) or on +61 2 9223 9166.