“Businesses in Australia – especially small businesses – are the engine of the Australian economy and deserve direct support during a global recession.”
I agree with the Treasurer that Australian business are a crucial part of our economy – and helping those businesses will therefore help the economy.
Yesterday, the Rudd Government announced a huge package to help prevent or reduce the recession for Australia. Part of the package is aimed at business, whilst the remainder is aimed at creating jobs and increasing spending.
The small business and general business tax break is described in the Treasurer’s media release and fact sheet. For most small businesses, it makes the purchase of a new computer or other eligible assets (excluding cars and trading stock) more affordable.
Great news if you need a new computer – or you sell computers!
There are of course conditions to qualify for these deductions, such as having a turnover under $2 million to qualify as a small business.
The 30% tax deduction only applies for assets greater than $1,000 which may exclude many micro businesses. For example, an additional $300 deduction applies if you buy a $1,000 computer before the end of June 2009 – how many micro businesses would be buying a $1,000 computer unless in that industry?
However, if you are considering buying a new sewing machine, desk, computer, printer, camera, or similar, maybe the tax deduction will make it feasible for you to buy a larger and more expensive model.
How valuable do you think this tax break will be for your business? Will it impact on your buying decisions in the next few months?
Tags: assets, break, deduction, government, small business, tax
Well the Opposition doesn’t like the package so things could change…
It was interesting to hear someone from the Opposition this morning on radio (I missed the start so didn’t hear a name) give one reason for refusing the package as being too large was what I wrote above. Namely, small business will be limited in accessing the tax break because they don’t make a lot of asset purchases over $1,000.
While I agree with the limitiation on small business spending, how does ‘small business can’t use this break’ justify ‘the package will cost us too much’? Surely if small business don’t use the tax break, it won’t cost the Government!
While we wait and see what package we finally get, I am still interested in how other business owners view the tax break for small business – would it help you? Will it make you spend more, which is the main aim of the entire rescue package.
The latest is that a draft legislation was released on 24 February that “will provide a temporary 30 per cent investment allowance to small businesses for eligible capital investments of $1000 or over, and for other businesses for capital investments of $10,000 or more.”
Comments can be made until 10 March 2009 if you want your say – visit the Treasury site or read their FAQs.
Fabulous post,Maybe I might sign up to your rss.
You’re welcome Country Girl, I hope it helped you know about the potential tax break – although I hope you read it a while ago as the capital investment needs to be made by the end of 31 Dec 2009!
i run a small business both online and offline and they serve as my primary source of income. my small business at home is a mini hyrophonics vegetable farm..::
Thanks for sharing Holly – I bet you have some tasty meals with such fresh vegetables! Did you find the tax deduction useful for your business last year?