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Small business tax guide
What tax does a small business in Australia deal with? Depending on your structure, usually income tax (on your own return, or the company's or trust's), GST and BAS once you reach the threshold, PAYG withholding and super if you have staff, and sometimes FBT. Here's the overview — with links to the detail, and to us when you'd rather hand it over.
In this guide
Sole trader, partnership, company or trust — each is taxed differently and comes with different paperwork. A sole trader reports business income on their personal tax return. A company is a separate taxpayer with its own return and ASIC obligations, and a trust's income is generally taxed in the hands of its beneficiaries.
A company lodges its own income tax return every year. Base rate entities — aggregated turnover under $50 million and no more than 80% passive income — pay 25%; other companies pay 30% (ATO, 2025–26 and 2026–27).
You must register for GST within 21 days once your GST turnover reaches $75,000 (taxi and ride-sourcing drivers must register regardless of turnover). Quarterly BAS is due 28 October, 28 February, 28 April and 28 July; lodging online or through a registered tax or BAS agent may give you extra time.
Since 1 July 2026 (payday super), employers pay super each payday, and contributions need to reach the employee's fund within 7 business days of payday (20 business days for a new employee's first contribution). PAYG withholding from wages is reported through Single Touch Payroll.
If you take money or assets out of your company other than as wages or dividends, Division 7A can treat it as an unfranked dividend — unless it's handled correctly, for example under a complying loan agreement with minimum yearly repayments. The benchmark interest rate for 2026–27 is 8.77%.
Most planning has to happen before 30 June: asset purchases (the $20,000 instant asset write-off for businesses under $10 million turnover is now permanent from 1 July 2026), super contributions (the concessional cap is $32,500 for 2026–27), trust distributions and the timing of capital gains.
Family trusts are common for holding a business or investments. The trustee must make distribution resolutions by 30 June each year, and a 30% minimum tax on discretionary trusts from 1 July 2028 has been proposed but is not law yet.
The ATO says to keep most business records for 5 years from when you prepared or obtained them, or completed the transaction, whichever is later. ASIC requires companies to keep financial records for 7 years. Good records are also what make deductions like car expenses stand up.
Rates and thresholds checked on ato.gov.au, fairwork.gov.au and treasury.gov.au on 1 November 2026. General information only, not advice — your situation may be different.
Common questions
Usually income tax (on the owner's return, or the company's or trust's return), GST once GST turnover reaches $75,000, PAYG withholding and super for employees, and sometimes fringe benefits tax.
No. Many people start as a sole trader. A company or trust can suit some businesses as they grow, but each has its own costs and obligations — it's worth getting advice before you change.
Yes. We're registered tax agents in Sunnybank, Brisbane, and work with sole traders, companies and trusts in English and Chinese. Our office is by appointment, or contact us by phone, email or the online form.
Company and trust returns, BAS and year-end tax planning. Our Sunnybank office is by appointment, or work with us by phone, email or online.