Tax Laws are changing radiantly which is making it really hard for small businesses to keep track of everything they must know. Complying with the rules is becoming hard. Thus this blog will cover glimpse of changes and some tips to get ahead of the pack.
SINGLE TOUCH PAYROLL – PHASE 2
The ATO expanded the amount of information they expect to receive this year, which means employers now may require do some tweaks in their payroll software. A clear idea about SINGLE TOUCH payroll is already mentioned in our previous blog.
Each payroll software has its own process, but all it means categorising wages and deductions into ATO specified categories.
IMMEDIATE WRITE-OFF FOR ASSET PURCHASES
The immediate write off is changing from 1 July 2023 onwards. As you probably heard as part of the federal budget.
Prior to 1st July, businesses can write off the full cost of any of the business equipment, no matter what the cost is. From 1 July 2023, it will only apply to those items that costs less than $20,000.
It is important to remember that this isn’t a “bonus” or “free” deduction. One can claim the cost of the asset under normal rules, it’s just spread over the life of the asset.
Before you buy anything, just make sure that you will get maximum profit this year, be it saving more tax next year than this year. This is more relevant for sole traders, partnerships, and trusts.
SUPERANNUATION RATE INCREASE
A reminder for businesses that the rate of super that needs to be paid to staff is increasing to 11% (up from 10.5%) on 1 July 2023. This new rate applies to wages paid to staff on or after 1 July.
Most payroll software will automatically update their programs and rates, however if you are not using the in-built superannuation categories you may need to manually update yours.
RECONCILE YOUR PAYROLL
Once 1 July ticks over should be bothering about reconciling payroll to ensure that the information one put on staff’s group certificates is correct. This means clearly verifying that the payroll data matches the data in the ledger and the info being reported on BAS’s.
Once everything is completed, small businesses can lodge their group certificates with the ATO until 31 July to (which is now called an STP finalisation).
MINIMUM WAGE INCREASE
The minimum wage per hour is currently $21.38, but an increase is expected soon. Keeping in mind that “wage theft” is now a crime. Kindly ensure you are quite diligent in paying your staff at least their minimum requirements.
Still finding it hard to understand, Hire RSG Accountants and get your business best taxation in Australia.