1. Low and Middle Income Tax Offset from 1 July 2018
The Income Tax Offset will be expanded for the 2018/2019 Tax Year to reflect the following:
2. Increase in the tax bracket thresholds:
Don’t get too excited as the changes don’t start until 1 July 2022. We could see three more Prime Ministers by that stage. They are moving the $41,000 tax bracket to $45,000 before transitioning into the 32.5% tax rate.
3. Extension for provision allowing small business to instantly write off asset purchases:
The increased asset write off will be increased to $30,000 on assets purchased from 3 April 2019 until 30 June 2020. This will apply to all businesses with an aggregated turnover under $50 million. The Treasurer’s incentive for small and medium business to keep the wheels turning.
4. Superannuation contribution changes:
From July 2020, the contribution age limits will be extended to allow taxpayers aged 65 and 66 to be able to make both concessional and non-concessional contributions without passing the work test. Work test is satisfying 40 hours of work in 30 consecutive days.
The bring-forward rule of three years of non-concessional contributions ($300,000) will also be extended by two years from the same start date.
Please note that these are just budget announcements, so remember to call our office if you are looking at implementing any of the above items. Given that we have an imminent election, it will be interesting to see whether these announcements actually become law. Stay tuned and we will keep you informed of their progress.