Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS

Division 328 - Small business entities

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Guide to Division 328

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History

Guide to Div 328 substituted for Subdiv 328-A by No 80 of 2007 , s 3 and Sch 3 item 2, applicable in relation to the 2007-08 income year and later income years. Subdiv 328-A formerly read:

Subdivision 328-A - Guide to Division 328
SECTION 328-5 What this Division is about

This Division gives you a choice to change the way the income tax law applies to you in these ways if you are carrying on a business with a small turnover, and you pass certain other criteria:

• you only account for annual changes in trading stock value that are more than $5,000; and

• you put your depreciating assets into either a long life pool or a general pool and treat each pool as a single asset.

In usual circumstances, these changes will simplify the working out of your taxable income, and so reduce your compliance costs.

Note:

If you choose to become an STS taxpayer, you may be entitled to the 25% entrepreneurs ' tax offset: see Subdivision 61-J .

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History

S 328-5 amended by No 41 of 2005, s 3 and Sch 2 items 6 and 7, by omitting ``3'' after ``applies to you in these'' and omitting the first list item, applicable to assessments for the first income year starting on or after 1 July 2005 and later income years. The list item formerly read:

• you use a cash accounting system for ordinary income, general deductions and deductions for tax-related expenses and repairs; and

S 328-5 amended by No 41 of 2005, s 3 and Sch 1 item 6, by inserting the note at the end, applicable to assessments for the first income year starting on or after 1 July 2005 and later income years.

S 328-5 inserted by No 78 of 2001.

SECTION 328-10 SECTION 328-10 Map of this Division
328-10

(Repealed by No 41 of 2005)

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History

S 328-10 repealed by No 41 of 2005, s 3 and Sch 2 item 8, applicable to assessments for the first income year starting on or after 1 July 2005 and later income years. S 328-10 formerly read:

Map of this Division
328-10
The following map shows the elements of the simplified tax system and how they relate to each other:

S 328-10 inserted by No 78 of 2001.

Subdiv 328-A inserted by No 78 of 2001.

SECTION 328-10 Concessions available to small business entities

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328-10(1)

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If you are a small business entity for an income year, you can choose to take advantage of the concessions set out in the following table. Some of the concessions have additional, specific conditions that must also be satisfied.

Item	Concession	Provision
1A	Immediate deductibility for small business start-up expenses	Subsection 40-880(2A) of this Act
1	CGT 15-year asset exemption	Subdivision 152-B of this Act
2	CGT 50 % active asset reduction	Subdivision 152-C of this Act
3	CGT retirement exemption	Subdivision 152-D of this Act
4	CGT roll-over	Subdivision 152-E of this Act
5	Simpler depreciation rules	Subdivision 328-D of this Act
6	Simplified trading stock rules	Subdivision 328-E of this Act
6A	Small business income tax offset	Subdivision 328-F of this Act
6B	Restructures of small businesses	Subdivision 328-G of this Act
7	Deducting certain prepaid business expenses immediately	Sections 82KZM and 82KZMD of the Income Tax Assessment Act 1936
8	Accounting for GST on a cash basis	Section 29-40 of the GST Act
9	Annual apportionment of input tax credits for acquisitions and importations that are partly creditable	Section 131-5 of the GST Act
10	Paying GST by quarterly instalments	Section 162-5 of the GST Act
11	FBT car parking exemption	Section 58GA of the Fringe Benefits Tax Assessment Act 1986
12	PAYG instalments based on GDP-adjusted notional tax	Section 45-130 in Schedule 1 to the Taxation Administration Act 1953

Note 1:

The CGT concessions mentioned in items 1, 2, 3 and 4 of the table apply only if you are a CGT small business entity (see section 152-10 ).

Note 2:

The small business income tax offset mentioned in item 6A of the table applies only if you are a small business entity as defined for the purposes of Subdivision 328-F (see section 328-357 ).

Note 3:

Some of these concessions are also available to medium businesses (for example, see subsection 328-285(2) ).

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328-10(2)
Also, if you are a small business entity for an income year, the standard 2-year period for amending your assessment applies to you (section 170 of the Income Tax Assessment Act 1936 ).

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