Understanding taxes is an essential part of running any business. In Australia administration and collection of taxes is overseen by the Australian Taxation Office (ATO). Taxation can be a complicated matter and for a business owner to be on top of things they need to have an in-depth understanding of how taxation works in Australia.
For Australian based businesses there are five tax categories that may impact you. Be sure that you understand how these work and how they are computed.
Understanding Australian Business Taxes:
All businesses based in Australia are subjected to company tax and the rate is set by the government and it varies depending on the type and size of the business. There are certain factors that affect the tax rate for each company including, but not limited to location, industry, workforce size and business structure. Businesses that are not based in Australia, but conduct business in Australia, are taxed in the same manner as a company based in Australia.
Capital Gains Tax
Simply put, Capital Gains Tax is tax paid on capital gains; it is incorporated with your income tax. Capital gains tax is computed against assets that you sell, like vehicles, properties, company equipment or furniture. Anything tangible that has to do with your business may affect your capital gains tax.
Goods and Services Tax
Goods and Services Tax (GST) is a 10% tax that covers almost all goods sold and services provided in Australia. Businesses must register for this tax and it is generally added to the cost of the goods and services paid by the customer or client.
As the name states it is a tax that you pay for your workforce’s payroll or salary. It is a state tax and all businesses that exceed the threshold for tax exemption must pay this tax. Check your local tax revenue office for the recommended threshold for your location and industry.
Other Businesses Tax
There are certain business taxes that the national or local government implement on businesses such as land tax. This depends on certain factors and it is best to consult your local tax revenue office to determine if you need to pay this tax and the rate at which it is computed.
Once you have an understanding of Australian business taxes and find you need some money to help pay tax debt, look to ALC Commercial. We offer tax debt relief loans for you and your business. Give us a call on 1300 886 996 or Apply Now!