The recent federal budget included a number of
changes to taxation and superannuation rules and I have summarised some of the
key announcements below:
Personal
- Education tax refund will be paid in advance for the 2012 financial
year to all eligible parents. This payment will be made in June 2012, so
no claim for educational expenses will be required in your 2012 tax
return.
- Education tax refund is being replaced with the “Schoolkids Bonus”
worth $410 for primary school and $820 for high school students. This new
automatic payment will be paid to families receiving Family Tax Benefit A
in two equal instalments in January and July each year. Parents don’t need
to keep receipts as the payment is a fixed guaranteed payment.
- The 50% discount for interest income will not proceed.
- Scrapping the proposed standard tax-deduction for work related
expenses. Therefore, work related expense claims will still need to be
substantiated by receipts or other documentation.
- Non-residents tax rates aligned to resident tax rates subject to a
minimum rate of 32.5%.
- Means testing the medical expense offset for taxpayers who have an
adjusted taxable income above medicare surcharge thresholds.
- Confirmation that the following tax rates will apply from 1 July
2012
|
Income Thresholds
|
Tax Rates including Medicare
|
|
$0 - $18,000
|
Nil
|
|
$18,001 - $37,000
|
20.5%
|
|
$37,001 - $80,000
|
34.0%
|
|
$80,000 - $180,000
|
38.5%
|
|
$180,000 plus
|
46.5%
|
Please note that with the low-income tax offset, low
income earners effectively now have a tax-free threshold of $20,542
Business
Taxation
- For new vehicles purchased after 1 July 2012, an immediate
depreciation write-off on the first $5,000 of the vehicles cost is
available with the balance of the vehicles cost depreciated at the normal
business write-off rates
- For assets purchased after 1 July 2012, an immediate depreciation
write-off is available for assets with a cost of less than $6,500.
- Companies will be allowed to carry-back losses for up to 2 years,
for a maximum amount of $1,000,000, to claim back income tax paid within
this period. This benefit is currently proposed only to apply to companies
with sole traders, partnerships and trusts not included. Hopefully this
benefit can be extended to all business’s
Superannuation
- Limit deductible superannuation contributions for all taxpayers to
$25,000 in the 2013 and the 2014 financial years. These contributions
include personal deductible and salary sacrificed. The higher $50,000
threshold still applies for the over 50 year old taxpayers till the 30th
June 2012, so take advantage of this higher threshold this year if you
can.
- Doubling of the superannuation contribution tax rate to 30% for
taxpayers who have an adjusted taxable income above $300,000
For
an obligation free interview to discuss the effects of the budget on your
business or to see if a self-managed superannuation fund could suit you, please
call Gregory Enright at Enright Chartered Accountants today on 6686 4744.