Budget 2021 – Tax Breaks for Your Business
The hospitality industry is still bearing the brunt of the pandemic. Cafes and restaurants in the city are suffering a double whammy. With people now working part of the week from home, CBDs around the country are a lot quieter than they would like. The 2021-22 Budget thankfully reflects these challenges for the industry.
Here are some ways you can benefit from the recent tax initiatives announced in the 2021-22 Federal Budget.
More money in the pockets of consumers
To support the economic recovery, there’ll be an additional $7.8 billion in personal income tax relief. Low and middle income earners will receive tax relief of up to $1,080 for singles, and up to $2,160 for dual income families.
Extra cash is sure to encourage extra spending. After a year of uncertainty, some tax breaks are sure to be celebrated with a nice meal and a bottle of red.
The instant asset write-off scheme has been extended
The government is encouraging businesses to spend, to keep the economy going. So, they’ve created a strong incentive for businesses to start buying equipment now, rather than putting it off. Temporary full expensing will now be available until 30 June 2023.
This temporary measure allows eligible businesses to claim an immediate deduction for the full cost of eligible capital assets.
Loss carry-back has been extended
Chances are, like most of the hospitality industry, your business experienced a loss over the past year. Temporary loss carry-back will also be extended by one year. This means your business could carry-back tax losses from the 2022-23 income year to offset past taxed profits as far back as the 2018-19 income year.
So, if you can prove your business suffered a loss during the pandemic, you may be able to get back some of the tax you paid in FY 2018-19 or later.
JobMaker hiring credit
The Federal Government announced a new JobMaker incentive for businesses to employ young job seekers aged 16 to 35 years old. For each eligible employee, you’ll receive the following for up to 12 months:
$200 a week if you hire an eligible young person aged 16 to 29 years; or
$100 a week if you hire an eligible young person aged 30 to 35 years.
But, you need to be quick, because this scheme ends 6 October 2022.
Restaurant and cafe owners can gradually build up their staff. With the lifting of COVID-19 restrictions, consumer demand is sure to increase.
ATO debt recovery paused
If the ATO was chasing you for money, the government has given you some breathing space.
Before the recent budget measures, small businesses could only pause or modify ATO debt recovery actions through the court system. This was obviously costly, time consuming and stressful.
Now, applying to the Administrative Appeals Tribunal (AAT) instead of the courts will save small businesses at least several thousands of dollars in court and legal fees, and, as much as 60 days of waiting for a decision.
The information contained above is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.
Taxation, legal and other matters referred to above are of a general nature only and are based on Comcater’s interpretation of the budget and should not be relied upon in place of appropriate professional advice.
With Thanks from Comcater