Home | About Us | Our Services | Our People | Contact Us | Employment | Disclaimer & Privacy Policy | Search Site

Office Address

Suite 902 Level 9
153 Walker St
North Sydney NSW 2060

Postal Address

PO Box 1827
North Sydney NSW 2059

Tel02 9959 4855
Fax02 9959 5849



Tax Facts

Small Business Tax

Below is a range of useful tax rates for small and medium sized businesses. Included are individual marginal tax rates, company tax rates, reasonable domestic and overseas travel claim allowances, PAYG withholding calculator, fringe benefits (FBT) car calculator, motor vehicle kilometre rates, concessional and non-concessional superannuation contributions limits, plus other superannuation and GST thresholds.

Click on your selection:

Resident Individual Tax Rates
Reasonable Travel Allowance Claims for Domestic & Overseas Travel
Goods Taken from Stock for Private Use by Business Owners 
Company Tax Rates
PAYG Withholding Calculator
Motor Vehicle Depreciation Cost-Limit
Per Kilometre Motor Vehicle Rates
Taxation of Complying Superannuation Funds
Superannuation Contribution Limits 
Other Superannuation Thresholds for 2020/21 
GST Thresholds

Resident Individual Tax Rates - 2021 to 2024 financial years

TAXABLE INCOME

TAX ON THIS INCOME

$0 – $18,200

Nil

$18,201 – $45,000

19c for each $1 over $18,200

$45,001 – $120,000

$5,092 plus 32.5c for each $1 over $45,000

$120,001 – $180,000

$29,467 plus 37c for each $1 over $120,000

Over $180,001+

$51,667 plus 45c for each $1 over $180,000

Compulsory superannuation rate: 9.5%

Notes on tax rates

- Taxable income includes capital gains.

- Medicare levy is imposed at the rate of 2% of taxable income is not included.

- Resident individuals are entitled to a refund of imputation credits that exceed the primary tax payable.

- Resident individuals are entitled to the 50% discount on the disposal of assets that are held for at least 12 months.

Reasonable Travel Allowance Claims for Domestic & Overseas Travel

Where an employee, company director, or office holder receives an allowance for travel costs within or outside Australia and the person makes a claim for the costs of accommodation, food, drink and incidental expenses up to certain limits, then the person is not required to keep written evidence (i.e. receipts) of the expenses. These deduction limits are based on the salary of the person and the destination of the trip.

The travel must be for business purposes and the person must be sleeping away from home. Note this concession does not apply to self employed persons, including partners in a partnership.

Click here and then scroll down to access the reasonable travel allowance claims within Australia for 2020/21.

Click here and then scroll down to access the reasonable travel allowance claims within Australia for 2019/20.

Goods Taken from Stock for Private Use by Business Owners

The ATO each year issues a Determination which outlines the amounts that are acceptable as estimates of the value of goods taken from trading stock for private use by business owners (including their associates) in certain industries who operate as sole traders or in partnership. The relevant amounts need to be included in the assessable income of the individual for the year.

Note that an adjustment for the GST credits claimed in relation to these amounts also needs to be made.

Fringe benefits tax and a different set of valuation rules apply where the business owner is employed through a company or family trust.

Click here and then scroll down to access the acceptable amounts for 2019/20.

Click here and then scroll down to access the acceptable amounts for 2018/19.

Company Tax Rates

The standard company tax rate is 30%.

From the 2017–18 income year, companies that are base rate entities must apply the lower company tax rates (see below table).

A base rate entity is a company that both:

  • has an aggregated turnover less than the aggregated turnover threshold  - which is $50 million from the 2019-19 year onwards
  • 80% or less of assessable income is base rate entity passive income (e.g. interest, dividends, rent, and net capital gains). 

Income Year

Applicable Turnover Threshold
($)

Company Tax Rate
(%)

2017-18

25 million

27.5

2018-19

50 million

27.5

2019-20

50 million

27.5

2020-21

50 million

26.0

2021-22

50 million

25.0

Notes

Companies are required to maintain a franking account on a tax paid basis and are not entitled to a refund of imputation credits that exceed the tax payable.

Companies are not entitled to the 50% discount on the disposal of assets that are held for at least 12 months.

PAYG Withholding Calculator

This calculator is provided by the Australian Taxation Office and determines the PAYG Withholding for an employee who is paid either weekly, fortnightly or monthly.

Click here to access the calculator.

Motor Vehicle Depreciation Cost-Limit

Since 1980, the depreciation deduction for cars has been limited by a deemed maximum cost price depending on the year in which the car was acquired.

Income Year

Depreciation Cost Limit
$

2013

57,466

2014

57,466

2015

57,466

2016

57,466

2017

57,581

2018

57,581

2019

57,581

2020

57,581

2021

59,136

Per Kilometre Motor Vehicle Rates

These rates are used by individuals when making a claim for motor vehicle expenses up to a maximum of 5,000 business kilometres. They are also used by employers when reimbursing employees for business use of their vehicles.

The rates are based on the engine size of the car and are as follows:

Engine Capacity
(non-rotary engine)

Engine capacity
(rotary engine)

Rate per Kilometre (cents)

2009/10 year

2010/11 year

2011/12 year

2012/13 year

2013/14 year

2014/15 year

Up to 1,600cc

Up to 800cc

63

63

63

63

65

65

1,601 to 2,600cc

801 to 1,300cc

74

74

74

74

76

76

Over 2,600cc

Over 1,300cc

75

75

75

75

77

77

The above three rates have been replaced with a single rate commencing with the 2015/16 year as follows: 

2015/16 Year:    66 cents per kilometre

2016/17 Year:    66 cents per kilometre

2017/18 Year:    66 cents per kilometre 

2018/19 Year:    68 cents per kilometre

2019/20 Year:    68 cents per kilometre

2020/21 Year:    72 cents per kilometre

Taxation of Complying Superannuation Funds

Superannuation funds are taxed a rate of 15% on taxable income which includes employer contributions and the deductible portion of self employed contributions. Funds are entitled to a one-third discount on the disposal of assets that are held for at least 12 months and are also entitled to a refund of imputation credits that exceed the tax payable.

Income tax is not payable by the fund on income and capital gains where pensions are paid to the members.

The following changes apply from 1 July 2017:

- the tax exemption for assets supporting a transition to retirement income stream (TRIS) has been removed. This change applies irrespective of when the TRIS commenced.

- there is a $1.6 million cap on the amount of superannuation benefits that an individual can have in pension phase which is not subject to tax. The excess over this amount will need to be withdrawn by the member or maintained in an accumulation phase account where earnings are taxed at the rate of 15%.  

Work Test Changes

Up until 30 June 2020, there was no requirement for a person to satisfy a work test for personal concessional and non-concessional contributions before reaching the age of 65.

However, once they reached 65 years of age in the financial year, a work test of 40 hours in 30 consecutive days was required to be met at any period during that year, and prior to the contribution being accepted. 

Providing the work test is met in a financial year, personal concessional or non-concessional contributions can be accepted up to 28 days after the month in which the person reaches the age of 75. 

From 1 July 2020, the age at which the work test applies has been increased from 65 to 67 which provides a greater scope for people to make personal conessional or non-concessional contributions.   

The extension of the bring forward rule to the age of 67 years is expeced to be made law in the next sitting of Parliament. 

Concessional Superannuation Contribution Limits

The following contribution limits have applied since 1 July 2017:  

- A single annual concessional contributions cap of $25,000 applies to all individuals - both concessional personal and employer contributions are included in this threshold.  

- the threshold at which high income earners pay additional contributions tax of 15% is $250,000 (Division 293 Tax).

Carry-Forward Concessional Super Contributions

From 1 July 2019, individuals can make 'carry-forward' concessional super contributions if they have a total superannuation balance of less than $500,000 at 30 June of the previous year. The unused concessional contributions caps can be used on a rolling basis for five years upon which they will expire.

For example, if a person had $20,000 in concessional contributions made on their behalf during the 2018-19 and 2019-20 years, the $5,000 unused cap for each year carries forward to the 2020-21 year.

This means the person can make concessional contributions of up to $35,000 in the 2020-21 year without breaching the contributions cap if their super balance was less than $500,000 at 30 June 2020.  

Non-Concessional Superannuation Contribution Limits

The annual non-concessional (after-tax) contribution cap is $100,000 per year, and $300,000 under the 3 year bring-forward rule.

The following table outlines the contribution and bring forward available to members aged under 65: 

Total superannuation balance

Contribution and bring forward available

Less than $1.4 million

Access to $300,000 cap (over three years)

Greater than or equal to $1.4 million and less than $1.5 million

Access to $200,000 cap (over two years)

Greater than or equal to $1.5 million and less than $1.6 million

Access to $100,000 cap (no bring-forward period, general non-concessional contributions cap applies)

Greater than or equal to $1.6 million

Nil

The total superannuation balance is determined on 30 June of the previous financial year.

Other Superannuation Thresholds for the 2020/21 Year

  • Super guarantee (SG) rate - remains at 9.5% of ordinary times earnings. The next rate rise is due on 1 July 2021 where it will increase to 10% as part of the Government’s initiative to increase the SG rate to 12% by 1 July 2025.
  • Maximum super guarantee contributions base – increased to $57,090 from $55,270 per quarter. Employers don’t have to provide the minimum super support for the part of earnings above this limit.
  • Capital Gains Small Business contributions cap – increased to $1,565,000 from $1,515,000. The CGT cap amount is the lifetime super contribution limit for proceeds from the disposal of eligible small business assets.
  • Low rate tax cap – increased to $215,000 from $210,000. The low rate cap is the lump sum amount that can be withdrawn tax-free over a lifetime for people that have reached their preservation age, but are not yet 60.
  • Government Co-Contribution lower income threshold – increased to $39,837 from $38,564. This is the threshold above which the maximum co-contribution amount of $500 begins to taper.
  • Government Co-Contribution higher income threshold – increased to $54,837 from $53,564. This is the threshold above which the co-contribution will not be paid.

GST Thresholds

Item

* Threshold

Requirement to issue a tax invoice

$75

No requirement to withhold if supplier does not quote ABN

$75

Turnover for compulsory registration for GST

$75,000
(for any 12 months)

Turnover for compulsory registration for GST (non-profit entity)

$150,000
(for any 12 months)

Annual turnover for compulsory use of non-cash accounting

$10,000,000

Annual turnover for compulsory monthly electronic BAS lodgement

$20,000,000

* all amounts are GST exclusive

 

Disclaimer

This information is provided as a guide only and is not intended to constitute professional advice. You should obtain appropriate advice concerning your particular circumstances.

The firm disclaims all liability for any loss or damage to any person or organisation, whether a user of this site or not, for the consequences of anything done or omitted to be done by any such person relying on this information.




Liability limited by a scheme approved under Professional Standards Legislation