Free invoice generator and tax tools for Australia

A small business in Australia deals mainly with the Australian Taxation Office (ATO). Sole traders, partnerships and trusts lodge an income tax return by 31 October; companies lodge by 28 February and pay 25% if they are base rate entities (aggregated turnover under $50 million and 80% or less of income from passive sources) or 30% otherwise. Registered businesses also lodge a Business Activity Statement (BAS), which reports GST, PAYG withholding, PAYG instalments, fringe benefits tax, luxury car tax and wine equalisation tax.

Employers withhold PAYG tax from wages using ATO tax tables, report payroll data to the ATO through Single Touch Payroll with every pay cycle, and pay the 12% superannuation guarantee. Payroll tax is separate: it is charged and collected by each state or territory revenue office, with its own returns. Contractor payments in certain industries go in the Taxable Payments Annual Report.

The most recent reform took effect on 1 July 2026. Under Payday Super, employers must pay super when they pay wages instead of quarterly, and the Small Business Superannuation Clearing House closed on the same day. Also from 1 July 2026, the first resident income tax band falls from 16% to 15% for 2026-27, and to 14% from 2027-28.

Australia has no single turnover tax. Instead, a business with aggregated turnover under $10 million is a small business entity, which unlocks ATO concessions, offsets and simpler accounting options, whatever its structure (sole trader, partnership, company or trust). Companies below $50 million aggregated turnover with 80% or less passive income are base rate entities and pay the 25% company tax rate instead of 30%. Sole traders have no separate business tax: business profit is added to personal income and taxed at the resident individual rates on the same return. A business that wants these concessions still needs an ABN, keeps normal records, and registers for GST only once turnover reaches the threshold.