Key 2015 Federal Budget Changes for Small Business in Australia plus valuable ideas for reducing your income tax in 2015.

1. 2015 Budget Update &
Year-End Tax Strategies

2. Overview
2015
Budget
Tax
Strategies
Q & A

3. 2015 Budget - Small Business
• Accelerated depreciation for assets up to $20,000.
• Start Ups, immediate deduction for professional expenses, to
establish a new business.
• From 1 July 2015, Company Tax rate to reduce from 30% to
28.5%.
• Unincorporated entities will receive a 5% discount on tax, up
to a maximum of $1,000.
• From 1 July 2016, taxpayers will receive relief
from Capital Gains Tax when changes are made
to it’s structure.

4. 2015 Budget - Other Business
• From 1 July 2017, foreign companies will pay GST on digital
products. “Netflix tax”.
• Tax integrity measures will be imposed for multi-nationals that
are shifting profits from Australia to low-tax countries.
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5. 2015 Budget - Superannuation
• There were no changes to superannuation in the 2015
Budget.
• In response to the Tax White Paper and Murray Financial
System Inquiry changes to superannuation are expected, in
the future.
• Under review…
− Borrowing in Self-Managed Superannuation Funds.
− Limitations on tax-free pensions for wealthy retirees.
$ $ $ $

6. 2015 Budget - Individuals
Individual’s Tax Rates – Residents
2015/16 & 2016/17 Threshold Marginal Tax Rate
1st rate $18,200 19.0%
2nd rate $37,001 32.5%
3rd rate $80,001 37.0%
4th rate $180,001 47.0%

7. 2015 Budget - Aged Pension
Social Security Assets Test – Current
20 Mar 2015 to
31 Dec 2016
Home Owners Non-Home
Owners
Full pension: single $202,000 $348,000
Full pension: couple $286,000 $433,000
No pension: single $775,500 $922,000
No pension: couple $1,151,500 $1,298,000
* Pension phased at $1.50 per $1,000 over the thresholds.

8. 2015 Budget - Aged Pension
Social Security Assets Test – Proposed
From Jan 2017 Home Owners Non-Home
Owners
Full pension: single $250,000 $450,000
Full pension: couple $375,000 $575,000
No pension: single $547,000 $747,000
No pension: couple $823,000 $1,023,000
* Pension phased at $3.00 per $1,000 over the thresholds.

9. 2015 Budget - Child Care
Annual Family
Income
% of Child Care
Fees Subsidised
Up to $65,000 85%
Up to $170,000 50%
$185,000 and above Capped at $10,000 per child, per year
• Applicable from 1 July 2017.
• Single child care subsidy will be introduced to replace existing three
subsidies.
• New subsidy will be ‘means’ tested and based on an activity
test/hours worked.

10. 2015 Budget - Child Care
Hours Worked
Per Fortnight
Hours of Child Care
Subsidised
8 to 16 36
17 to 48 72
49 or more 100
Work Activity Test

11. Year-End Tax Strategies
• Accelerated asset depreciation up to $20,000.
• Superannuation contributions.
• Timing strategies...
− Prepayment of business expenditure.
− Deferral of customer invoicing.
− Delay sale of profitable assets.
− Bring forward assets with losses.

12. Year-End Tax Strategies
• Re-value trading stock.
− Lower stock >>> Lower taxable income = Less tax.
• Write off bad debts.
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13. Structural Tax Changes
• A growing business may require a change in it’s structure to
manage tax liabilities.
• Options…
− Discretionary trusts
− Private companies
− Self-Managed Superannuation Funds for investment
assets, including business property.
• From 1 July 2016, small businesses can change their
structure without triggering Capital Gains Tax.
• Possible to restructure without paying capital gains tax but
stamp duty will apply to value of assets transferred.

14. Summary
• The 2015 Budget changes benefit small business owners.
• Take advantage of tax savings before 30 June 2015.
• Consider if your business structure is still appropriate?
• Consider the benefits of having a Self-Managed
Superannuation Fund?

15. Questions