SMB’s Are The Winners.

Federal Treasurer Scott Morrison’s budget is good news for small to medium sized businesses – which are the biggest percentage of employers in the nation. In a nutshell, the tax rate will reduce to 27.5% for businesses with a turnover up to $10 million in 2016/17. Further tax concessions will apply in future financial years. This comes into effect on 1.7.2016. Also, a lifetime cap on non-concessional (after-tax) superannuation contributions of $500,000 was instantly introduced; the income tax threshold at which the 37% tax applies will increase to $87,001 pa, from the current $80,001 pa. on July 1; also from that date the annual cap on concessional (pre-tax) super contributions will reduce to $25,000, regardless of age; concessional super contributions may exceed the annual cap if certain conditions are met; those aged between 65 and 74 will be able to make super contributions regardless of whether they work or not; tax deductions will be able to be claimed for personal contributions regardless of employment status; a lifetime limit of $1.6m will be placed on the amount of superannuation that can be transferred to start pensions; earnings on investments held in ‘transition to retirement’ pensions will be taxed at 15% (currently 0%).
Source: MLC