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Small Business Company Tax Rate

Small Business Company Tax Rate

  • Thursday, 04 February 2016 22:44

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:

•28.5% if the company’s aggregated turnover is below a $2 million threshold (i.e. a small business entity); and percentage

•30% if the company’s aggregated turnover is equal to or above a $2 million threshold.

The lower rate of 28.5% 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.

Companies don’t need to do anything now. If identified as a small business, the new rate will be automatically applied to their PAYG instalments rate or on their next activity statement.

Where a small business has a late balancing substituted account period (SAP), their PAYG instalments will be adjusted from their first 2015–2016 instalment period. For early balancing SAPs, the reduced rate will not apply until their 2016–2017 income year.


Let us advise you with your accounting and taxation needs!