Should you be concerned about the recent economic announcements?

As a small business owner, we recognize your need to know which of the specific changes being mentioned by the recent Henry Review and the more recent May Budget, affect you.

We also appreciate our duty of care as your accountant and adviser to succinctly brief you on such issues and best assist your future business direction.

The proposed changes mentioned to date are as follows:-

• a cut in the company tax rate from 30% to 28% from 1 July 2012;
• a change in the way depreciation is calculated, including being able to write off low value items immediately. The new low value threshold means that any assets under $5000 (previously $1000) can be immediately written off from 1 July 2012;
• an gradual increase in the SG payments required to be made for your employees from 9% currently to 12% to be phased in over the next 10 years; beginning 1 July 2013; and
• the introduction of a Resources Super Profits Tax of 40%, when combined with company tax will form a combined statutory tax rate of 55%. This will have significant flow on effects for small businesses providing services to resource companies. The government has not ruled out applying such a tax to other industry groups going forward.

You can feel comfortable that the team at Baker Affleck will keep across these proposed changes and how they can affect your business. In the meantime, we suggest you give your Baker Affleck accountant or adviser a call to discuss any new business asset purchases and ensure they are structured in the most appropriate manner.

You can also contact Baker Affleck Financial Solutions for sourcing finance when this is required. This way your company has the required cash flow to meet its obligations as well as take full advantage of any future opportunities.

Contact your Baker Affleck accountant or call Baker Affleck Financial Solutions on (07) 5538 3088.