Company Tax

COMPANY TAX STRUCTURE – GENERAL TAX ISSUES

The extract below is from the Australian Taxation Office. This information provides a basic summary of general company tax return and associated company tax and business tax reporting obligations.

Company

A company is a distinct legal entity with higher set-up and administration costs because of additional reporting requirements.

Companies are regulated by the Australian Securities & Investments Commission (ASIC).

A company is run by its directors and owned by its shareholders. A company provides some asset protection but directors can be legally liable for their actions and, in some cases, the debts of a company.

The main features of a company business structure are:

  • a company must apply for a Tax File NumberExternal Link (TFN) and use it when lodging its annual tax return
  • a company registered under the Corporations Act 2001 is entitled to an Australian business number (ABN). A company not registered under the Corporations Act may register for an ABN if it’s carrying on an enterprise in Australia
  • a company can register for Goods and Services Tax (GST) if it’s carrying on an enterprise. A company must be registered for GST if its annual turnover is $75,000 or more ($150,000 for non-profit organisations)
  • the money a business earns belongs to the company, not individuals
  • companies must lodge an annual company tax return showing income, deductions and income tax liable to pay
  • companies usually make Pay As You Go (PAYG) instalments, credited against total annual income tax. The amount of tax it’s liable to pay is reduced by any PAYG instalments paid during the year
  • companies have no tax-free threshold
  • a company pays income tax on its assessable income (profits) at the company tax rate and may be eligible for tax concessions
  • a company may treat income and deductions relating to personal services income (PSI) differently
  • if the company has any eligible workers, it must pay them super guarantee contributions. This includes you, if you are a director of the company, and any other company directors.

Personal services income

A company may treat income and deductions relating to personal services income (PSI) differently. The income may be treated as your individual income for tax purposes.

Small business company tax rate

The small business company tax rate has been reduced from 30% to 28.5% for income years commencing on, or after, 1 July 2015. This lower rate also applies to small businesses that are corporate unit trusts and public trading trusts.

The corporate tax rate will remain at 30% for all other companies that are not small business entities.

Taxopia online tax accountants can assist you with any structural company tax questions. We have very cheap company tax return solutions for your business. Contact us today on 1300 829 674

oFor any inquiries, please call: 1300 829 674 or fill out our online form

Company or Trust Tax Return for Accountants & Bookkeepers

* BASIC PLAN ($400+ GST) CONDITIONS, excludes the following items:

* STANDARD PLAN ($800+ GST) CONDITIONS, excludes the following items; however, these services can be provided for an additional cost.

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* Premium Package pricing conditions, please take note the premium pricing excludes the following items; however, these services can be provided for an additional cost.

If any of these exclusions apply to your businesses, please contact us, and we would be happy to provide you with a customised quote.

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* Standard Package pricing conditions, please take note the standard pricing excludes the following items; however, these services can be provided for an additional cost.

If any of these exclusions apply to your businesses, please contact us, and we would be happy to provide you with a customised quote.

Get started now!

* CONDITIONS to our Basic Tax Reporting Package for Company or Trust Tax Return ($400+ GST), excludes the following items:

If you do not qualify for this option, you will need to consider our Standard Tax Reporting Company or Trust Tax Return ($800+ GST) option.

Get started now!

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