Key business announcements in the Federal Budget
The 2021 Federal Budget has provided extensions to two tax schemes for small to medium-sized businesses. These extensions are designed to encourage business investment and to provide a short-term cash flow increase.
1. Extension to the temporary full expensing scheme
Under the temporary full expensing scheme, small and medium-sized businesses will be able to claim the total cost of all new asset purchases as tax deductions until the end of the 2022/23 financial year.
This measure was first announced in the October 2020 Federal Budget and was scheduled to cease at the end of the 2021/22 financial year. It allows businesses with an annual turnover up to $5 billion to immediately deduct the full cost of assets bought, rather than having to depreciate them over several years.
2. Extension to the temporary loss carry-back scheme
Another key tax measure being extended is the temporary loss-carry back scheme. This scheme aims to help small to medium-sized businesses that are still struggling from the impact of the COVID-19 restrictions. It allows any losses to be claimed as an offset against previously taxed profits.
Up until the end of the 2022/23 financial year, businesses will be able to offset losses against profits made as far back as the 2018/19 financial year to receive a tax refund. The refund value is limited to the amount of the business’ previously taxed profits.
How we can help
At Scorpion Bookkeeping, we can help you to ensure that your business bookkeeping is accurate and up to date. We service a diverse range of clients in South Australia, Victoria and New South Wales.
We can also help you implement Xero bookkeeping software to make managing your business finances quick and easy. We are a Xero-certified partner.
Contact us today for a free, no-obligation consultation to find out how we can help!