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News of the day – 17th May 2021
by Adam Dawson
Good News for Small Businesses in the Federal Budget
by Adam Dawson – 17th May 2021
Last year’s tax cuts and the ‘loss carry back offset scheme’ have both been extended for another year!
It’s great news for small businesses and a welcome sign that the government is committed to fuelling our economic recovery via small business support.
The tax cuts apply to those earning less than $126,000 annually and the maximum benefit is $1080 per year.
The loss carry back scheme is a refundable tax offset for years 2020-21 and 2021-22 and it represents the tax an eligible entity would save if it was able to deduct the loss in the previous year. It’s a refundable offset so it could result in a cash refund, a reduced tax liability or a reduction of a debt owing to the ATO. It has been legislated, make use of it!
You do not need to amend the previous income years to claim the offset and if you don’t choose to carry back a loss, the loss may be carried forward to use in a later income year. Good news indeed.
The scheme allows losses from revenue downturn to be offset but the point of the exercise is to encourage business owners to invest in themselves at this time. The tax offset is combined with ‘full expensing’ measures which allow businesses to deduct most of the costs incurred by purchasing a new asset.
It’s the perfect time to upgrade your equipment, vehicles and machinery. It will never be cheaper to do so. Start spending if you can!
Rebuild Now offers a free assessment to check your eligibility and calculate how much you could save by accessing the support.