Here’s a few important reminders about what business operators should put in place and be aware of for the start of this 2024 financial year:
National minimum wage and award rate
Businesses need to be aware that from the first full pay period on or after 1 July, the national minimum wage would increase to $23.23 per hour and that award rates of pay would be increased by 5.75 per cent. This means you need to review your updated award rates and ensure you are paying employees equal to or above their rate for their classification for the first payrun in July. Be aware, in some states like Victoria, underpaying wages is considered wage theft and, in some instances, can result in criminal charges. Let us know if you need assistance with:
- Identifying your award
- Classifying employees
- Updating pay rates in your payroll system
Super guarantee
From 1 July the super guarantee rate has increased from 10.5 per cent to 11 per cent for all employees eligible to receive superannuation.
Business owners would need to use the new rate to calculate super on payment made to employers on or after 1 July, even if some or all of the pay period was for work done before 1 July.
Your payroll system should handle this change for you without your intervention but be sure to check the super calculation has changed for your first payrun in July.
Single touch payroll (STP)
Small businesses are alerted to the requirement to have finalised their employees’ single touch payroll data by 14 July.
Employers are now required to report pay-as-you-go withholding information every time they pay employees through single touch payroll with the amounts reported to be used as pre-fill information in activity statements from 1 July.
If you need assistance reconciling your payroll for the prior year or you still have not setup STP correctly and are not filing STP to the ATO every payrun you need to address these issues now. Clients on bookkeeping subscriptions with payroll are covered however otherwise, let us know if you need assistance with:
- Reconciliation of payroll control accounts
- STP setup and end of year finalisation
Payroll Tax annual declarations or returns
Make sure you understand your specific states reporting obligations and payroll liability thresholds to determine if and when you need to file and pay annual payroll tax declaration or returns. For example:
- Victoria: 2023 wages threshold is 700,000 a year and annual declarations are due to be returned and paid by 21 July 2023
- NSW: 2023 wages threshold is 1,200,000 a year and annual declarations are due to be returned and paid by 28 July 2023
- QLD: 2023 wages threshold is 1,300,000 a year and annual declarations are due to be returned and paid by 21 July 2023
Let us know if you need assistance with:
- Understand your specific states reporting obligations and payroll liability thresholds to determine if and when you need to file
- Reconciliation of payroll control accounts
- Calculate your liability and file your states annual payroll tax declarations or returns
Workers compensation insurance declarations
Employers are reminded to certify or lodge their annual rateable remuneration to ensure their workers compensation insurance costs are not under or over allowed. There are specific due dates for each state authority however we recommend you update actual remuneration for the prior year and forecasts as soon as possible (ideally end of July each year) after you have reconciled the year’s payroll as to avoid paying too much insurance. Some key dates include:
- Victoria: Certify remuneration by 27 October 2023 (large employers) 22 March 2024 (small employers)
- NSW: Actual wages declaration within four months of policy renewal
- QLD: Between 1 July and 30 September each year
Let us know if you need assistance with:
- Calculating your rateable remuneration for the year (gross wages less exempt payments)
- Forecasting your rateable remuneration for the current year
- Reconciliation of payroll control accounts
- Filing your annual declaration or return for your specific state
Paid parental leave scheme
For employees whose baby was born or placed in their care on or after 1 July, the scheme would change with the 18 weeks of paid parental leave entitlement combined with the dad and partner entitlement of two weeks’ pay.
The change would mean partnered couples would be able to claim up to 20 weeks of paid parental leave between them, while parents who were single at the time of their claim could access the full 20 weeks.
Instant asset write-off
From 1 July the instant asset write-off threshold for eligible small businesses would be $20,000 on a per-asset basis for 12 months.
From 1 July assets valued at more than $20,000 that could not be immediately deducted as has been the case in prior years and could be placed into the small-business simplified depreciation pool and depreciated at 15 per cent in the first income year and 30 per cent each following year.
Small-business energy incentive
A tax incentive worth up to $20,000 would be available for small businesses this financial year to provide an additional 20 per cent depreciation for eligible assets that support electrification and the more efficient use of energy by small businesses.
The scheme would provide businesses with an annual turnover of less than $50 million incentive to save on energy bills by making investments such as electrifying their heating and cooling systems, upgrading to more efficient fridges, or even induction cooktops.
While the scheme was still pending passing through Parliament, eligible assets or upgrades would need to be first used or installed ready for use between 1 July 2023 and 30 June 2024.
Small business skills and training boost
Small businesses with an aggregated annual turnover of less than $50 million will be allowed an additional 20% tax deduction for external training courses delivered to employees by registered training providers.
The boost applies to eligible expenditure incurred from 7:30 pm AEDT on 29 March 2022 until 30 June 2024.
What you can claim:
- The bonus deduction is available for expenditure for the provision of training to one or more employees of your business. The training provider must meet certain registration criteria for the bonus deduction.
- Training expenses can include incidental costs related to the provision of training, provided they are charged by the registered training provider, such as the cost of books or equipment needed for the course.
- If your business is registered for GST and the training is not GST-free, the bonus deduction is calculated on the GST exclusive amount plus any GST you cannot claim as a GST credit in carrying on your business.
- Where deductions are to be claimed over time such as for capital deductions, the bonus deduction is calculated as 20% of the full amount of the eligible expenditure. It can be claimed upfront in the first income year in which the bonus deduction is available.
- There may be fringe benefits tax (FBT) consequences associated with the expenditure you incur. For more details, refer to Fringe benefits tax – a guide for employers.
Small business technology investment boost
Be aware the small business technology investment boost available to small businesses with an aggregated annual turnover of less than $50 million which allowed for an additional 20% tax deduction to support their digital operations and digitise their operations has now ended as at 30 June 2023.