Understanding Australian taxes and meeting your taxation obligation is essential to your business and can save you time and money. Most major business taxes are collected by the Australian Tax Office (ATO). Avoid payment penalties by paying the right amount of tax and also take advantage of the tax concessions your business is entitled to. Here is how;
- Use the free tool offered by the Australian Taxation Office (ATO). This tool assesses your situation and simply answers the question “Is your business tax ready?” You can download the tool at https://www.ato.gov.au/Business/Register-for-personalised-business-assistance/
- Register for a business assistance visit online to discuss your business tax questions
- Watch the series of the free webinars at https://www.ato.gov.au/General/webinars/
Record keeping requirements:
Under Tax Law, you must keep records of the following information for 5 years;
- Your income tax
- Your GST, Goods and Services Tax
- All of the payments to your employees
Under the Fair Work Act 2009, the following information must be kept for 7 years;
- Employee information (e.g. time and wages records)
You can get the Record keeping for small business booklet from;
Or call 13 28 66.
The taxes that are going to affect your business are; Income Tax, Capital Gains Tax and the Goods and Services Tax which will be explained in details in the rest of the article.
Understanding Australian Taxes – Company (income) Tax
- Australian resident companies and non-resident companies are both taxed at the same rate by the Australian Government.
- For more information on company tax, including company tax rates, see ATO:
- For small business company tax rate, see ATO:
Capital Gains Tax (CGT)
CGT is paid as part of income tax and is applied on any capital gain your business makes through the disposal of any assets (e.g. selling shares, units in a unit trust, property and business assets)
Understanding Australian Taxes – Goods and Services Tax (GST)
GST is a broad-based tax of 10% on most goods and services sold or consumed in Australia.
If you register for GST, you will be entitled to claim an equivalent input tax credits.
For more information about GST, see ATO: http://www.ato.gov.au/gst
Finally, NAT has produced presentations to tell you everything you need to know about taxation in Australia by introducing the tax system and answering the following questions;
- Why you pay tax
- How NAT collect it
- What is NAT role in the process
The presentations are available in 16 languages in 3 DVD’s. You can order the DVD’s online at https://www.ato.gov.au/about-ato/about-us/contact-us/order-publications/
Or phone them at 1300 720 092.
Your feedback and participation is highly appreciated.
We wish you the best of luck with your venture.
Review the complete series for start-up stratagems
Part One - Business Startup Australia – Introduction Part Two - Business Startup Australia: Getting Help and Support Part Three - Business Startup Australia: Business Structure Part Four - Business Startup Australia: Business Plan Part Five - Business Startup Australia: Obtaining Finance Part Six - Business Startup Australia: Registering Your Business Part Seven - Business Startup Australia: Registering Business Name Part Nine - Business Startup Australia: Home-based Business Part Ten - Business Startup Australia: Online Business Part Eleven - Business Startup Australia: Employing People Part Twelve - Business Startup Australia: Workplace Health & Safety Part Thirteen - Business Startup Australia: Online Marketing Part Fourteen - Business Startup Australia: Securing Your Online Business Part Fifteen - Business Startup Australia: Importing Part Sixteen - Business Startup Australia: Exportation