Skip to content Skip to menu
Australian Government Coat of Arms

Budget | 2015-16

Budget 2015-16
Australian Government Coat of Arms, Budget 2015-16

Cutting red tape

Small business has told the Government that a key impediment to growth is unnecessary red tape and regulation.

As of March 2015, the Government has announced reforms to generate more than $2.45 billion in annual red tape savings for Australians.

These reforms include changes to the entry thresholds for Pay‑As‑You‑Go instalments, benefiting 447,000 small businesses.

To build on the Government's reforms to date, the Jobs and Small Business package provides key, additional red tape cuts so that small businesses will have more time to focus on growing and developing new ideas.

Cutting red tape is particularly important for small businesses because they experience a proportionately larger regulatory burden than larger businesses in the same industry.

The Government will reduce red tape within the Fringe Benefits Tax (FBT) system by expanding the FBT exemption for work‑related portable electronic devices. This will help small business employees stay connected in the digital economy.

Small businesses will also benefit from Capital Gains Tax rollover relief when changing their legal structures but keeping the same owners. That means that new businesses that discover they are using a legal structure that does not suit their needs are not stuck with that structure forever. This reduces risk and complexity and makes it easier for businesses to grow.

The Government will release a consultation paper on potential changes to the Corporations Act to reduce any unnecessarily burdensome or restrictive regulatory requirements for small businesses. This will make it easier for new and existing small business to operate as a company.

Small businesses are faced with a disproportionately higher red tape burden

Tax compliance costs per $1,000 turnover

This column chart shows: Large businesses - $2; Small to medium businesses - $12; Micro businesses - $90

Changes to the Fringe Benefits Tax system

Small business

Darren owns a small web-design business in inner city Melbourne. He has five employees, each of whom he provides with both a laptop and a tablet, for work-related use.

Current law

Under the current law, Darren may be unable to obtain an FBT exemption for both a laptop and a tablet, as both devices could be considered to have substantially identical functions.

In that case, Darren would have to pay Fringe Benefits Tax on one of the devices.

New law

Under the new law, it will be clear that Darren will be able to obtain an FBT exemption for both the tablet and the laptop.

All work-related portable electronic devices will be FBT free.

Making it easier to access the FBT exemption for portable electronic devices


The new law improves certainty and reduces red tape around the FBT law.

Under the new law, Darren will not be liable to pay FBT on either device, saving him time and money which he can use to reinvest and grow his business.

An FBT exemption will be allowed for small businesses providing their employees with multiple work-related devices, even where the items have substantially similar functions.

As a small business, Darren may also be eligible for a range of other taxation benefits including:

  • tax cut for small companies (see pg 7)
  • tax discount for unincorporated businesses (see pg 9)
  • accelerated depreciation (see pg 11)
  • small business concessions on capital gains tax
  • simplified accounting and reporting arrangements
  • immediate deduction for certain pre-paid business expenses
  • option to account for GST on a cash basis
  • option to elect for annual apportionment of some GST input credits
  • option to pay GST by quarterly instalments
  • PAYG instalments based on GDP-adjusted notional tax