5 things you
need to know
about
Business Taxes
- Paying your taxes is part and parcel of running a business. Business owners need to pay or arrange payment of a large number of taxes. Examples include GST, payroll tax, company tax and, if you sell shares in your business, capital gains tax.
- Goods and services tax (GST) is a consumption tax collected by the ATO. If your business generates over $75,000 or more in a year, you are required to collect GST. As a GST-registered business, you need to issue tax invoices to your customers to collect GST, and these need to be sent to the ATO with your BAS statements. Your accountant will be able to assist in completing your BAS statements.
- Payroll tax is a state and territory tax that is assessed on the wages that a business pays to its employees when the total amount of wages exceeds a threshold amount.
- If you sell your business, you will likely be liable to pay capital gains tax. Capital gains tax is calculated based on the difference between the amount you purchased your business for, and the amount you sold it for. If you’re considering selling your business, you should speak with an accountant to work out the most effective tax treatment.
- Finally, remember that taxation for businesses is complex. Make sure you work with an accountant and a tax lawyer if necessary.
