Tax concessions for small business entities

Eligible small business entities can access a number of tax concessions, including on:

• Capital Gains Tax (CGT)
• Income tax
• Goods and Services Tax (GST)
• Pay As You Go (PAYG) instalments
• Fringe Benefits Tax (FBT).

To be eligible you must meet the following conditions:

• you are an individual, partnership, company or trust
• you are running a business
• you have an aggregated turnover of less than $2 million.

You'll need to check if you qualify for the concessions each tax year. Additional conditions may apply to certain concessions.

The benefits of the concessions include:

• a choice to account for GST on a cash basis
• simplified trading stock rules
• simpler depreciation rules
• immediate deductions for certain prepaid business expenses.

Some of the small business concessions were previously available under the Simplified Tax System (STS). If you were in the STS you can continue to use the concessions if you meet the eligibility requirements.

Entrepreneurs' Tax Offset (ETO)

If you're a small business that has an aggregated turnover of $50 000 or less, then you'll be eligible for an ETO of 25% of the tax payable on your business income. The offset phases out when your aggregated turnover is greater than $50 000 and ceases once your turnover reaches $75 000.