Interesting new tax breaks for small businesses... helpful for starting up!

[Cage]

I used to work in the accounting field many, many years ago, so I'm totally out of touch with current legislation.

However I would like to point out that this is not a handout but a tax deduction, and as has been stated above it would appear to be most beneficial to established businesses with a cash flow.

For a small company this concession amounts to a taxable deduction up to a maximum of $19,999.99, and at the current company tax rate of 30%, this equates to a reduction of $5,999.99 in their tax liability for the year in which the deduction is claimed, assuming that the company is trading profitably.

The saving will vary greatly for sole traders etc depending on their income. For example those earning between $37,001 – $80,000 the tax is $3,572 plus 32.5c for each $1 over $37,000, the tax rate varying between 9.7% and 21.9%.

For those in the $180,001 and over bracket it's $54,547 plus 45c for each $1 over $180,000 at a rate of 30.3% to 44.9%.

So yes, it's a deduction, but only useful if you have a taxable income to deduct it from.