The ATO has reminded taxpayers that, from 1 July 2015, a new two-tier company tax system took effect and applies to all companies.

This system sees the whole of a company’s taxable income subject to the following rates:

  • 5% if the company’s aggregated turnover is below a $2 million threshold (i.e., a small business entity or ‘SBE’); or
  • 30% if the company’s aggregated turnover is equal to or above a $2 Million threshold.

Importantly, companies don’t need to do anything now – if identified as a small business, the new rate will be automatically applied to their PAYG installments rate or on their next activity statement.

For more information please contact your Account Manager on 02 9406 5900.