Federal Budget 2021: Benefits for small and medium-sized businesses

SMEs were among the winners in Federal Budget 2021 handed down by Treasurer Josh Frydenberg on May 11. From a financial perspective, initiatives announced include the expansion and extension of government support in relation to full expensing and loss carry back.

There’s extra funding for training, upskilling, and apprenticeships, which will be particularly welcome in sectors suffering skills shortages, such as IT and Agriculture.

Spending has also been increased on the digital economy, which will help SMEs to streamline productivity, and improve cash flow with reduced administration and faster payments. These initiatives will bring down the costs of doing business.

Indirectly, SMEs that support the infrastructure sector will benefit from an additional $15.2 billion for a range of infrastructure projects, including highway and rail upgrades around the country, and freight hubs like the Melbourne Intermodal Terminal.

Federal Budget 2021 highlights for SMEs

Here are our five key takeaways for SMEs from Federal Budget 2021 and how your business can take advantage of them.

Financial bonuses

The temporary investment tax incentive announced in last year’s budget has been extended for a further 12 months, until June 30, 2023. Businesses with a turnover of up to $5 billion will be able to deduct the full cost of any eligible assets they purchase for their business, including the cost of improvements to existing assets, until 30 June 2023.New Paragraph