We’re all familiar with the dreadful stereotypes of small business accountants as blood sucking leeches out to steal our hard earned money, but the reality is far from it, especially if you’re running a small business here in the Melbourne area. Never forget that accounting- and the government legislation around finance- is a full and difficult field it can be tricky to navigate if you’re not yourself a financial professional.
Australia runs on contributions from small businesses.
Yet the economy relies heavily on entrepreneurial start-ups and micro enterprises. Statistics place the number of people employed by small businesses at about half of all people employed! That’s a huge number. It’s a market that’s being picked at by the presence of online businesses and, of course, the massive power of larger corporations. The government and the ATO has, however, tried to even the balance with a host of concessions, tax breaks and other incentives for compliant companies. It’s a huge arena to keep up with, though, and for the legislatively inexperienced business owner it’s more then possible you’re missing out on a distinct advantage- or misusing an advantage in a way that may place you at financial risk. If you’re in a business of less then $2million turnover, a small business accountant in Melbourne could help you maximize your profit and your compliance with legislation both.
Concessions offered to small business clients.
Amount the many ATO and governmental legislation offered to small businesses are the following
- Income Tax Relief
- Service/Goods tax concessions.
- PAYG concessions, click here to read more about PAYG concessions.
Income Tax Relief
As a small business in Australia, you’re entitled to a simpler system of depreciation then is allowed to larger firms, with higher immediate depreciation limits designed to encourage investment in good equipment. As an entrepreneur you’re also allowed a tax offset of up to 25% of business income if your turnover fits into certain categories. While that rule is in the process of being phased out, you will continue to be allowed easier trading rules on stock, only needing to report stock if the value changes by a certain floor limit. You’re also allowed up front deductions of prepaid expenses. AA good accountant can help you with all of these.
Service/Goods tax concessions.
These are all designed to minimise your burden of compliance when dealing with BAS forms. Again, there is an applicable turnover limit. These can help keep turnover liquid and provide a cash boost.
Your PAYG can be pre-determined, on the basis of recent income tax returns, if you are a qualifying small business. This means that you will not have to handle these yourself, and make your year end recon much easier. However, you will still need this process monitoring to ensure that you are not paying too high a monthly instalment- again, a good small business accountant will be able to help you with this.
On top of these three major areas, there’s a number of capital gains tax concessions available for asset sales and the sale of a small business. While these concessions exist to help you along in a competitive business environment, they can also be incredibly difficult to comply with if you’re not well versed in financial law. In order to take maximum advantage, you need to be well versed when it comes to planning and implementing financial strategics, and getting advice from a professional is always the best route. The team at accountantmelbourneco.com.au can help you find a small business accountant in Melbourne for your needs.