Construction businesses right around Australia were negatively impacted as a result of the pandemic. Halting projects because of lockdowns and people being a bit iffy about getting measure-and-quotes, let alone undertaking a new job, made a real dent in operations across the country.
If you operate a business in the construction industry, you’re no doubt across all of the tax benefits that were implemented in last year’s Federal Budget. But it’s a new year, and there’s a new Budget that’s just been laid out. You might be wondering whether the recently-announced 2021-22 Federal Budget will make a difference to your bottom line - so let’s get into it and review how your business can benefit.
1. Investment into major infrastructure projects across Australia
Like last year, there’s a huge amount of money being invested ($15.2 billion over 10 years) into infrastructure in most of the states and territories around Australia, including:
- $2.6 billion for the North-South Corridor (Darlington to Anzac Highway) in South Australia
- $2 billion for Great Western Highway upgrade (Katoomba to Lithgow) in New South Wales
- $2 billion to support the construction of the Melbourne Intermodal Terminal
- $1 billion towards the local roads and community infrastructure program
- $400 million for the Bruce Highway in Queensland
- $380 million for the Pakenham roads upgrade in Victoria
- $237 million for the Metronet to go towards grade separations and the elevation of stations in Western Australia
- $161 million for the Truro Bypass in South Australia
- $160 million for agricultural supply chain improvements in Western Australia
- $150 million for national highway network upgrades in the Northern Territory
- $132 million for the Canberra light rail (stage 2A)
- $113 million for the Midland Highway upgrades in Tasmania
- $80 million for Bass Highway safety and freight efficiency upgrades in Tasmania
- $26.5 million for William Hovell Drive duplication in the Australian Capital Territory
2. An allocated housing package budget
The government has announced that it is going to allocate just over $782 million over four years towards a ‘housing package’, which is aiming to not only increase the percentage of home ownership but also work to provide additional residential construction jobs.
The majority of this allocation - $774 million - is going towards the substantial amount of HomeBuilder grants that have been submitted (120,000 total; 4 times more than was expected) which will be spread over the next two years. This is due in no small part due to the announcement within the Budget that the construction commencement requirement has been extended from the initial 6 months up to 18 months (for existing applicants).
A further $124 million has been allocated for the next two years to both assist social workers within homelessness and housing sectors as well as help improve social housing.
3. The instant asset write-off scheme has been extended
In last year’s budget, you probably recall the announcement that for businesses with a turnover of up to $5 billion, business assets purchased were able to be written off to their entire value immediately. This is now being extended by another 12 months and will encompass business-related assets purchased between last year’s Budget all the way through to 30 June 2023.
This means now might just be the ideal time to give your current line-up of commercial equipment and vehicles a refresh - give us a call now on 1300 787 288 to discuss equipment financing today.
There are of course caveats to this scheme, so be sure to check on the ATO website and speak with your accountant to confirm the specifics pertaining to your particular business.
4. Loss carry-back has been extended
If you’re operating in the construction industry, you may have experienced a drop in your profits due to the pandemic. If this is the case, you may be eligible to offset this profit reduction against tax your business paid in the 2018-19 financial year.
Essentially, if you’re able to prove that your business suffered profit loss during COVID, you’ll be able to get back some of the tax you paid in FY 2018-19.
5. JobTrainer/Boosting Apprenticeship Commencements expansion
Wage subsidies for businesses that take on new apprentices and trainees are being extended by another 12 months, now continuing until September 2022. This means you can bring new staff onboard to help meet the demand of your increasing operations but don’t have to overextend on your budget to do so.
Finance a new commercial vehicle or equipment with ease
Ready to get the ball rolling and get the most out of the latest Budget announcements?
At Stratton Finance, our knowledge and experience helping construction businesses secure the right business loan packages spans more than two decades now. We know commercial finance like the backs of our hands, and with access to a gigantic network of lenders you can bet we’ll find the perfect finance solution for your business’ needs. Use our free online commercial finance quote tool to discover just how low your monthly repayments could be.
For more information or to find out how we can help your business thrive, have a chat with the Stratton Finance team today on 1300 787 288. Otherwise, you’re welcome to message us online and we’ll be in touch as soon as we can.
Disclaimer: Nothing in this article should be assumed as personal advice. You should consider whether the information is appropriate to your needs, and where appropriate, seek advice from a professional financial adviser.