Recorded Webinar: Small Business Company Tax Rate - Risks and Opportunities

The reduction in the small business entity company tax rate from the 2016/17 year has been modified by further changes which apply from the 2017/2018 year. These legislated and anticipated changes in the corporate tax rate for small business entities can trip up the unwary and result in trapped franking credits or over-franking of dividends. This session identifies the risks and opportunities that arise with the reduced tax rate and discusses the following issues by reference to worked examples:

• What is the differences between the franking rate and the tax rate?

• How to maximise the franking credits without risking overfranking?

• Changes from 2017/18:

  • what is base rate passive income?

  • how do the look-through rules in relation to trust distributions work?

• Practical compliance tips:

  • how to lodge before the legislation passes - Lodge and amend versus lodging based on the new rules

  • what to do in the event of inadvertent overfranking: the ATO’s approach (PCG 2018/D5)

  • repeal of the ‘carrying on a business’ requirement - do any 2017/18 returns need to be reviewed and amended?