Within this recent budget the Government has announced they will be increasing the low and middle income tax offset which should benefit individuals whose taxable incomes are less than $125,999 by receiving between $255 and $1,080 back in tax refunds. Please refer to below to determine the tax offset that could be paid to you.
It is important to note here that this is a non-refundable tax offset, as a result of this if you have not paid any tax or your tax payable is less than the tax offset, you are not entitled to the surplus tax offset to be paid to you.
The government has also proposed that from 1 July 2024, they would like to simply the personal income tax rates further by only having 3 tax rates as apposed to the current 4. The below table illustrates what the proposed tax rates would be should this be legislated:
Medicare levy low-income thresholds
The government has proposed to increase the Medicare low-income threshold for singles to $22,398 (this is an increase of $418 from the 2018 tax year). For couples with no children the threshold would be $37,794 (this is an increase of $705 from the 2018 tax year). With an additional threshold of each dependent child to be $3,471 (this is an increase of $65 from the 2018 tax year).
To those Australians receiving either the age pension, disability support pension, carer payment, parenting payment single recipients and veterans and their dependants receiving payments from Veteran affairs will receive a one of payment of $75 for singles and $125 for couples for an Energy Assistance Payment.
New Deductible Gift Recipients
The following organisations have been approved as deductible gift recipients from 1 July 2019:
- Australian Academy of Law
- China Matters Limited
- Foundation Broken Hill Limited
- Motherless Daughters Australia Limited
- Superannuation Consumers Centre Limited; and
- The Headstone Project (Tasmania) Incorporated.
Additionally, Men’s Sheds and Women’s Shed will be considered a Deductible Gift Recipient from 1 July 2020.
Farm Household Allowance
The budget has introduced that from 1 July 2019, farmers will be able to discount or exempt forced livestock sales which is subsequently invested in farm management deposits if they are currently receiving the Farm Household Allowance. This is reform is aimed to assist farmers to continue to receive an income while trying to destock their properties and thus assisting them to make long term financial decisions.
GST and Indirect Taxes
This budget has not addressed any changes affecting GST.
Luxury Car Tax Refunds
This budget has addressed a further benefit for farmers and tourism operators, by increasing the luxury car tax refund to a maximum of $10,000 for vehicles acquired after 1 July 2019.
ABN rules to be introduced
The Government will introduce legilsation to those currently holding an Australian Business Number (ABN) in attempt to tackle the black economy.
ABN holders will be required from 1 July 2021 to lodge their income tax returns. From 1 July 2022 all ABN holders will be requried to confirm the accuracy of the contact details at the Australian Business Register each year to encourage ABN holders to be more accountable in meeting their government obligations.
Banking Royal Commission
The Government has proposed to provide $606 million over the next 5 years to enact the 76 recommendations of the Hayne Royal Commisions report. These include:
- Creating and establishing a industry funded compensation scheme as a last resort for consumers and small businesses.
- Providing further funding ot the Australian Financial Complaints Authority to assist them with preparing the historical redresses for the eligible financial complaints from 1 January 2008.
- Providing further resources to ASIC and APRA to enforce the activities in relation to corporate governance, culture and remuneration.
A new $525 million skills package was announced during the budget which will look to double the incentive paid to $8,000. This package will be aimed at creating 80,000 new apprenticeships over the next 5 years in the following industries they have noticed with skills shortgages:
- Carpenters and joiners
- Airconditioning and refrigeration mechanics
- Bricklayers and stonemasons
- Bakers and pastry cooks
- Vehicle painters
- Wall and floor tillers