Did you know that eligible entities may be entitled to a reduced tax rates of 25%? These include companies, corporate unit trusts and public trading trusts.

If your company or trust is a 'base rate entity', the tax rate is 25% from the 2021–22 income year onwards.

For your company to be a 'base rate entity', the following eligibility criteria must be met:

• Aggregated turnover for the income year is less than the aggregated turnover threshold (which is $50 million from the 2018–19 income year onwards, or $25 million for the 2017–18 income year).
• If your company earns passive income, it cannot exceed 80% of the company's assessable income in that income year. Passive income can include: corporate distributions and their franking credits; royalties and rent; most income from interest; gains on qualifying securities; and a net capital gain.

The full company tax rate of 30% applies to all companies that are not eligible for this lower company tax rate.

The rates are different for previous years and different rules apply.