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This year we have replaced our usual detailed budget newsletter with 3 words ... election, election, election!
As expected, the federal budget was very clearly the start of an election push. No major announcements were made and, to be honest, even if there were some big announcements, they would have been very unlikely to get passed [now, or in the future - depending on the election result, of course].
In all seriousness, there were a few other items worth mentioning so we have summarised for you the top hashtags of 2019/20 Federal Budget.
"You get a tax cut. You get a tax cut. Everybody gets a tax cut!" Well, almost everybody. Tax cuts were announced for most people in 2 phases starting with the current 2018/19 financial year, and then more from 2022/23. I do like the strategy of working towards 94% of all taxpayers paying tax at a marginal rate of 30%, but unfortunately this a long way off in reality.
The always popular instant asset write-off has been increased again. Assets now purchased up to $30,000 are covered from 2 April 2019 for businesses with an aggregated annual turnover up to $50m. Again, subject to the announcement becoming legislation.
The planned company tax rate reduction to 25% from 27.5% is now to be effective from 2021/22 - 5 years ahead of the original schedule. The tax cut that just keeps on giving.
It is proposed to relax the works test for people aged 65 and 66 making super contributions from 1 July 2020 [if passed]. This means further opportunities to get more into super in the last couple of years around retirement.
Big increases in the funds available for the ATO to increase their compliance activities including recovery of unpaid super and tax. Does this indicate a tougher approach from the ATO into the future?
No longer will you be able to register an ABN and just let it sit there forever. From 1 July 2021, ABN holders with tax obligations MUST lodge a tax return.
A favourite of the ATO and Fair Work Ombudsman, sham contracting will again receive more attention to ensure employers are not avoiding their Fair Work obligations.
There is no other way to describe the energy assistance payments but as handouts. I am sure those qualifying for the payments absolutely deserve and need the payment, but this is clearly trying to appease a wider portion of the electorate.
Of course, if you ever have any question as to how the budget announcements, if enacted, impact your personal circumstances please do not hesitate to contact us.
For more detailed information on the 2019/20 Federal Budget ...