The federal government has introduced legislation into the Parliament to implement the Simplified Tax System (STS), available to businesses with an average annual turnover of less than $1 million from July 1, 2001.
The STS will deliver a number of benefits by reducing the time and money that participating businesses need to spend on bookkeeping and income-tax compliance.
Participating businesses will also be able to immediately write-off purchases costing less than $1,000. Assets costing $1,000 or more and with effective lives of less than 25 years are pooled and written off at 30% a year, or 5% a year for assets with effective lives of 25 years or more, using the declining balance method.
The Bill also completes the government's changes to the rules for pre-payments, as recommended by the Review of Business Taxation.
The release of Exposure Draft legislation in October of this year provided the business community with the opportunity to contribute to the development of the STS, and following consultation with business representatives, the government has improved certain provisions of the STS Bill.
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