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Tax boost for small business operators

SMALL businesses are set to benefit from greater access to tax concessions and changes to GST thresholds from July 1, under new rules announced by the Australian Tax Office. Under the changes, businesses with an annual turnover of less than $2 million will be eligible for 14 new tax concessions for income tax, capital gains, fringe benefits, pay-as-you-go installments, and GST. Businesses with an annual turnover greater than $2 million may still be eligible for capital gains if they satisfy the net asset test, which has been increased to $6 million. GST registration thresholds have increased from $50,000 to $75,000 for businesses, and from $100,000 to $150,000 for non-profit bodies. The threshold for a tax invoice required to claim GST credits has been increased from $55 to $82.50 inclusive of GST, meaning a valid tax invoice is no longer required to claim GST credits for business purchases of $82.50 or less. Businesses with a turnover under the new thresholds have the option to either continue with their current GST arrangements, report and pay GST annually or cancel their GST registration. The changes come after repeated calls from business for a reduction of red tape and compliance costs, and a more simplified tax system.

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