Small business changes announced in the 2015-16 budget are now law. The following changes apply from 1 July 2016:
- 27.5% company tax rate for small businesses. The maximum franking credit that you can allocate to a frankable distribution is also 27.5%. If you have lodged early, see below for more information.
- 8% small business income tax offset (up to $1,000) limited to businesses with a turnover of less than $5 million. It applies only to business income for sole traders, or share of business income for partnerships or trusts
- $10 million small business turnover threshold (previously $2 million). This means more businesses can access a range of small business concessions, including the $20,000 instant asset write-off and reduced company tax rate.