Don’t Overlook the Federal Budget’s Goodies for Small Business
The Federal Government’s 2012 Budget appears to be favourable for small businesses, with most small businesses being able to take full advantage of the boost to the immediate asset write off limits from $1,000 to $6,500, according to Patricia Howard, the managing director of the Award Bookkeeping Company .
Come July 1, most business owners will also gain from the $5,000 deduction for buying a new car. In addition, to helping individual business owners, it should improve local auto sales and hopefully supporting manufacturing by increasing demand for Australian built cars.
There will also be some much needed relief from the hard trading conditions faced by so many businesses in recent years, with the Government offering up to $1million in losses to be offset against previous year’s profits.
"These are significant benefits to most small businesses, although business owners will need to move proactively to take full advantage of them. They won’t just happen, business owners need to be aware of them to make them happen," Ms Howard says.
"This is where having a well-trained bookkeeper, such as an Award Bookkeeper, makes all the difference to a business. Our small business owners are fully aware of these benefits," she says.
On a personal front, many small business owners will be able to take full advantage of the increase in the tax free threshold from $6,000 to $18,200 to minimise tax payments by distributing income to adult members within their families.
In addition, some small business owners wil also be able to take advantage of the Government’s proposed $1,000 cash hand out to those firms employing older workers.
That though is where the good news appears to end. “The much talked about proposed cut to the company tax rate has been dropped and the tax on superannuation contributions of high income earners will be doubled,” Ms Howard says.
"Although to be honest the impact of this on most small businesses will be negligible. The other provisions in the budget are much more targeted towards helping small business survive the current tough trading conditions."
The much speculated extension to the provisional arrangements allowing older Australian’s to make larger contributions to super also appears to have been axed.
"The real menace within the Australian economy, which has been causing such difficulties to so many local businesses, the high Australian dollar, will be little affected by the 2012 Budget, with exporters, tourist operators and others facing no relief," Ms Howard says.
"The high value of the currency is due to the current high level of mining exports and it is causing significant heartache to many small business around the nation. A large number of family owned business will simply go to the wall because of it."
More than ever small business owners need the skills of professional qualified bookkeepers, Award Bookkeepers, to get them through this very tough economic environment.11.05.2012