And now for some good news. See these little family of ducks? Cute as. We spied them last Sunday in Hagley Park where they were speed racing towards the water. Who knew ducklings to run so fast. Sometimes it feels like our Government is speed racing too – making announcements before the officials have a chance to come up with concrete proposasl. Still, we take good news where we can find it.
On 23rd September 2019 the Hon Grant Roberson (Finance Minister) and the Hon Stuart Nash (Minister for Small Business, and Revenue) issued a joint statement about proposed law changes (to be introduced next year).
Feasibility Expenditure – will be tax deductible, and for “qualifying expenditure” under $10,000 can be deducted in year one. Higher expenditure will be able to be spread over five years.
Sounds good, but where is the detail? Many of us know what “feasibility” is in our own businesses, but that does not always match the Revenue’s interpretation. What exactly will be “qualifying”? How will this interact with the existing (new) R & D tax loss cash out rules? We don’t know, but Robertson and Grant have said they will be looked at together.
Company Loss Continuity Rules – will be changed to allow start-ups to introduce (and presumably lose) new shareholders without having to worry about the loss of the existing tax losses.
Sounds good, but is it just for “start-up” companies as implied, or for all companies? What is a “start-up” v having already started but needing a lift up? Why the difference? What will the rules be? For example, in some jurisdictions the loss continuity rules only apply if the company’s business activity changes, not when shareholders come and go.
Still, take what we can get. Happy reading – click here for the very brief announcement.