Registration of small businesses will be streamlined as part of the government’s package for the sector, which will be a centrepiece of Tuesday’s budget.
Announcing measures to cut red tape, Treasurer Joe Hockey and Small Business Minister Bruce Billson said a single online registration site would be established. It would replace the present “fragmented and complex process” and save businesses time and money.
From July next year new businesses would be able to immediately deduct professional costs associated with starting up, rather than writing them off over five years.
“Many people need the advice of lawyers and accountants when they start a business,” the ministers said. “This can be expensive and drag on cash flow. Allowing these costs to be deducted immediately will allow more money to be invested in growing the new business.”
Small business owners will also be able to change the legal structure of their business without incurring a liability for capital gains tax. This would reduce some of the complexity of starting a new business and provide owners with greater flexibility to determine how they grew, the ministers said.
The government was making it easier for small businesses to access capital by removing obstacles to crowd-sourced equity funding, they said. It will also consult in coming months on the current framework covering the establishment and regulation of corporations, to investigate whether some of these can be eased to cut compliance costs.
The budget will contain an already-announced cut in company tax of 1.5% for small business and a new accelerated depreciation allowance is expected.
Interviewed on Sky, Billson rejected suggestions that the gap between the company tax rates for big and small businesses would cause problems.
Michelle Grattan does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.
Authors: The Conversation