Three - Quarters of Small Business Leaders Find the Tax System Confusing
Officeworks research also shows small business leaders are concerned about the growth of their businesses post-pandemic.
Despite small business leaders (SBLs) feeling relatively more confident about their business and increasing their spending on business equipment compared to the same time last year, new research from Officeworks shows almost three-quarters (73 per cent) of SBLs still find the tax system confusing and nearly two in three (63 per cent) are concerned about the growth or stability of their business beyond the pandemic.
To assist in a healthy tax return, almost a quarter (23 per cent) have increased their year-on-year spending on office supplies, furniture or business assets to take advantage of the government’s depreciation concessions for an increased tax return.
The research tells us SBLs are planning to capitalise on the depreciation concessions available, including the recently announced (although not legislated yet) ‘Technology Investment Boost’ in the 2022 federal budget. SBLs indicated they will spend an average of at least $17,000.
One-in-four small business leaders were unaware they could be eligible for the ‘Temporary Full Expensing’ concession to claim immediate deductions on depreciating assets first used or installed before June 30. In addition, more than half (54 per cent) of business leaders incorrectly assumed they could no longer claim the $150,000 ‘Instant Asset Write-Off’ which may be used to claim on items purchased in previous tax seasons.
Officeworks General Manager Merchandise, Jim Berndelis said:
“When Australians were required to work from home during the pandemic, many employees borrowed equipment from the office. As they have returned to their office in a flexible capacity, we have seen employers updating their office equipment such as ergonomic chairs, monitors and computer accessories. We’re also seeing products such as mobile phones, cables and charging devices continue to be popular to ensure staff can stay connected no matter where they are working.”
“As we approach June 30, we recommend small business leaders consult their taxation professional to ensure they are making the most out of the incentives and capitalising on tax-deductible upgrades.”
Incentives and savings opportunities are available on technology and office supplies to support staff working remotely as well as in the office, and 74 percent of SBLs responded that they will support remote work setups regardless of whether they expert staff to return to the office or not.
This means there is a unique opportunity for business leaders to claim more through the comprehensive Temporary Full Expensing concession.
Taxation Manager, Rebecca Morgan on behalf of the National Tax and Accountants’ Association (‘NTAA’) said: “Small and medium-sized businesses across the country should be taking advantage of tax-related COVID-19 relief measures and depreciation concessions currently implemented by the Australian Government. They are not forever guaranteed,”
To take advantage of tax-related concessions this year, SBLs should consider upgrading office equipment, investing in technology products and assisting employees in purchasing their work from anywhere equipment at Officeworks before June 30.
For more information about current tax concessions and eligible assets, please visit the Australian Taxation Office website.