​Small business owners hit by ‘tax trap’

by 07 Jan 2014
The Government has been accused of setting a “tax trap” for small business owners by not sufficiently advertising a change to tax concessions.

Labor Party MP Shayne Neumann says the Government has been underhanded in its management of the change.

“This is Tony Abbott’s tax trap for 2.7 million Australian small businesses and sole traders,” he said. “The Abbott Government is either so embarrassed by this or so dismissive of the needs of small business the Government has not made any effort to tell them about the change.”

Information about the change was published last year on the websites of the ATO and the Treasury.

Neumann said the Abbott Government was putting these changes in place from 1 January 2014 despite legislation not yet passing the Parliament, meaning small businesses will be retrospectively taxed.

Meanwhile, the Coalition Government has announced it will no longer prosecute small business owners acting in good faith on advice from the Fair Work Ombudsman.

Workplace Relations Minister Eric Abetz said the change will “deliver confidence to small business to grow, prosper and employ”.

“If, in good faith, callers to the Small Business Helpline follow the Fair Work Ombudsman’s advice, they will not be the subject of future penalty proceedings by the Fair Work Ombudsman should it turn out that advice was incorrect.”

“In combination with the recent announcement of priority service for small businesses who call the Ombudsman, small business operators will be able to spend less time getting advice and more time growing and supporting their enterprise.

On at least one occasion last year, a business was penalised after acting on incorrect information from the Ombudsman's office.