Following the 2019-2020 budget announcements last week, there are a number of upcoming changes that might affect our clients.
Personal income tax rates will be altered effective from 1 July 2022 to increase the limit of the 19% bracket to $45,000 from the current level of $37,000, an annual saving of $1,520.
The rebate/tax offset available to Low to Middle Income earners will also be increased with effect from 1 July 2018 (this financial year) to $1,080, up from the current $530, effective up to an income of $90,000pa, where it will reduce by 3% per dollar up to $125,334. This applies in addition to the Low Income Tax Offset of $445. From 1 July 2022 both the LITMO and the LITO will be replaced with a single tax offset with a maximum rate of $645.
The low income threshold applicable before Medicare Levy is imposed will also be increased.
The small business instant asset write off will be extended until 30 June 2020 and increased from the current $25,000 to $30,000.
The proposed changes to Division 7A loans from companies will be deferred until 1 July 2020, so we will need to address these prior to the introduction of the amendments.
Single Touch Payroll (STP) will be expanded to include every employer, no matter how small, who must notify the ATO via electronic means of all amounts paid to employees on or before the date paid, whether you have an electronic or manual payroll system.
The work test will be removed for superannuation contributions for those aged 65 and 66 years.
Those aged 65 and 66 will also have access to the bring forward rules to allow up to 3 years' of non-concessional contributions to be made to their fund.
Insurance within superannuation will no longer be compulsory and will now be available on an opt-in basis.
Actuarial Certificate rules will be relaxed
Additional funding to be provided to ASIC and APRA to restore faith in the financial sector, funding to the ATO for a 4 year crackdown of tax evasion and audit quality, new language, learning, literacy numeracy and digital skills programs, climate solutions package funding, apprenticeship skills funding package, drought support and emergency response funding package, national elder abuse hotline funding and funding to improve infrastructure including roads, bridges and high speed rail.
Found out more by contacting us at 1800.ARGYLEPRO (1800.274.953).