"GET OUT THERE AND HAVE A GO" - Joe Hockey
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
“GET OUT THERE AND HAVE A GO” - Joe Hockey
The second budget of the coalition government is about getting the country moving. Small business, farmers,
families and health are the big winners. This is a quick guide to the budget, but all measures depend on the
budget passing the parliament in full.
SMALL BUSINESS
The Federal Government has given small business Accelerated Depreciation
$5 million of incentives in this year’s budget. All small businesses will receive an immediate tax
deduction for any individual assets they buy costing
The Government defines a small business as any less than $20,000 (The old threshold was $1,000). This
business that has less than $2 million in revenue. arrangement starts from last night and continues until
30 June 2017.
96 per cent of all Australia’s businesses are small
businesses. They employ over 4½ million people and Cutting red tape - Fringe Benefits Tax (FBT)
produce over $330 billion of our nation’s economic The FBT exemption for work‑related portable
output per year. electronic devices will be extended to allow more
than one device per employee.
The Government hope that the changes listed below
will help small business pull the economy out of its
Cutting red tape - Capital Gains Tax
current low spot.
Small businesses will also benefit from Capital Gains
Tax rollover relief when changing their legal structures
but keeping the same owners.
Immediate deduction for professional expenses
on commencing a new business
From 1 July 2015, the government will allow businesses
to claim an immediate write-off for a range of
professional expenses associated with starting a new
business, such as professional, legal and accounting
advice.
Research and Development (R&D)
The government has introduced a cap of $100 million
on the amount of eligible R&D expenditure for which
companies can claim a tax offset at a concessional
Small Business Company Tax Cut rate under the R&D tax incentive. Expenditure beyond
The company tax rate for small businesses will be the $100 million cap will receive a lower offset at the
reduced by 1.5 percent to 28.5 per cent from 1 July company tax rate.
2015.
These changes apply in relation to assessments for
income years commencing on or after 1 July 2014.
Small Business Tax Cut
This measure also includes provisions for the changes
The Government will also provide a 5 per cent tax
to be reviewed five years following Royal Assent and
discount to unincorporated businesses with annual
to sunset 10 years following the start date of 1 July
turnover of less than $2 million from 1 July 2015.
2014.
Wagga Wagga | Cootamundra | Young | Cowra | Harden | Coolamon | Sydney 1
NEWSLETTER | BUDGET 2015/16
HAVE YOU VISITED OUR WEBSITE? www.twomeys.com.au
KEY MEASURES FOR FAMILIES
The Budget’s other key focus was families, with
the Government delivering a $4.4 billion Families
Package.
A new child care subsidy has been launched from
1 July 2017. The subsidy will target low-and-middle
income earners, tapering from 85% for low-income
families to 50% for families earning around $170,000
or more, up to an hourly fee cap.
The subsidy will assist low-income families earning
around $65,000 or less with 85% of their child care
fees, up to an hourly cap. Disadvantaged and vulnerable children will have better
access to early childhood services through the Child
A family with both parents working 8 hours Care Safety Net. This $869 million Child Care Safety Net
a fortnight each can have up to 36 hours incentive will provide support to children in need, including
of subsidised child care; families who work vulnerable children, children in regional and remote areas,
longer hours can have more child care hours Indigenous communities and children with additional
subsidised. Volunteering, paid work and study needs.
all counts. Child care centres will receive more funding for the
The Child Care Subsidy will subsidise 24 hours of equipment and staff they need to support children with
child care a fortnight for low-income families disabilities, and children from culturally or linguistically
with a parent who doesn’t work. diverse backgrounds.
In regional and remote communities, child care centres
The Government has introduced a Nannies
will be able to apply for grants to help service their local
Trial. The Trial will support care for around 10,000
community.
children whose families find it difficult to access
regular child care services. Disadvantaged Indigenous communities will also benefit
from having child care services better integrated with
Families earning less than $250,000 a year can maternal and child health and family support programmes.
apply. The trial will start on 1 January 2016 and
A $26 million boost to the Immunise Australia programmes
finish two years later, on 31 December 2017.
will be used to encourage doctors to vaccinate the
Nannies must be attached to an approved children they treat in their practice.
service, be at least 18 years old, have a current
Working with Children check and be qualified The Government’s ‘No Jab, No Pay’ rule means that
to give first aid. families who choose not to vaccinate their children will
not be able to receive child care payments or the Family
Children in all states and territories will be able Tax Benefit Part A end of year supplement. This starts on 1
to access 15 hours a week or 600 hours a year January 2016.
of preschool with a qualified early childhood
teacher. The Government will remove the ability for individuals to
double dip when applying for the existing Parental Leave
Key Points Pay (PLP) scheme, from 1 July 2016.
• A new child care subsidy Currently, individuals are able to access payments from
• Preschool Quality care for both the Government PLP scheme in addition to any
families in need employer - provided parental leave entitlements. However,
the Government has confirmed it will ensure that all primary
• Child Care Safety Net carers would have access to parental leave payments that
• Childhood immunisations are at least equal to the maximum PLP benefit (currently 18
• Double dip - PLP weeks at the national minimum wage).
• Nannies Trial
Wagga Wagga | Cootamundra | Young | Cowra | Harden | Coolamon | Sydney 2
NEWSLETTER | BUDGET 2015/16
HAVE YOU VISITED OUR WEBSITE? www.twomeys.com.au
THE REGIONS HEALTH AND AGED CARE
Farmers will be able to claim an immediate tax Terminal Medical Condition
deduction for water facilities and fencing from 1 July The Government is relaxing conditions under
2016. They’ll also be able to depreciate the cost of which people with a terminal medical condition
fodder storage assets over three years. can access their superannuation entitlements.
From 1 July 2015, access to superannuation can
A $35 million grants programme will help rebuild be made by people with a terminal medical
drought affected communities with civil and civic condition who are likely to die within two years.
infrastructure projects.
Medicare
New community and support services will be available To improve the sustainability of Medicare, the
for farmers in drought-affected areas with almost $20 Government will establish a taskforce to review
million for extending existing social and community Medicare Benefits Schedule items to ensure
support services, as well as $1.8 million to fund 10 new patients receive high quality and cost effective
counsellors as part of the Rural Financial Counselling medical services.
Service.
$1.6 billion will be spent on new and amended
The Government will provide $250 million to continue listings on the Pharmaceutical Benefits Scheme,
the Drought Concessional Loan Scheme and the including more effective treatments for cancer.
Drought Recovery Concessional Loan Scheme for The Government will also invest $485 million to
improve the electronic health record system for
another year. A further $25 million will help reduce the
all Australians.
impact of pest animals in drought-affected areas.
Medical Research
The government will not proceed with the previously
The Government will provide distributions of $10
announced but unenacted measure to replace
million in 2015 ‑16 from the Medical Research
the current GST-free treatment for supplies of going
Future Fund.
concerns and farmland with a reverse charge
mechanism.
Aged Care Reform
From 1 February 2017,
Mobile Black Spots funding for home
The $100 million Mobile Black Spots Programme will care will be allocated
see the first base stations rolled out later this year. to the consumer
based on their
Regional Development
care needs. This will
As well as investing in Australia’s north, the
provide consumers
Government is also developing regional Australia with greater choice
through the $1 billion National Stronger Regions Fund. in deciding who
Zone Tax Offset provides their care.
‘Fly-in fly-out’ and ‘drive-in drive-out’ workers (‘FIFO/
DIDO workers) will not be able to claim the Zone Tax Medicare levy increases
Offset where their normal residence is not with in a From the 2014 -15 income year, the medicare
levy low income threshold will be increased for
“zoned area”.
individuals to$20,896 (previously $20,542) and for
couples to $35,261 (previously $34,367). The family
Temporary working holiday makers
income threshold will be increased by $3,238
From 1 July 2016,the Government will treat most
(previously $3,156) for each dependent child or
people who are temporarily in Australia on a “working
student. For single seniors and pensioners, the
holiday” as non-residents for tax purposes,regardless
threshold will be increased to $33,044 (previously
of how long they stay. Non-residents do not have
$32,279).
access to the tax-free threshold or the low income tax
offset and are taxed at a marginal tax rate of 32.5%
from the first dollar of earnings.
Wagga Wagga | Cootamundra | Young | Cowra | Harden | Coolamon | Sydney 3
NEWSLETTER | BUDGET 2015/16
HAVE YOU VISITED OUR WEBSITE? www.twomeys.com.au
PENSIONS
The Government will make changes the pension from 1 January 2017 by:
• increasing the ‘asset free areas’ for both homeowners and non-homeowners.
• increasing the asset test taper from $1.50pf to $3pf per $1,000 of assets over the lower threshold.
Asset free area changes
The proposed changes to the asset free area (the lower assets test threshold) are:
• For homeowners, the asset free area is proposed to increase from $202,000 to $250,000 for singles and
from $286,500 to $375,000 for couples. This represents an increase in the lower assets test threshold of
$48,000 and $88,500 for singles and couples respectively.
• For non-homeowners, the asset free area is increasing from $348,500 to $450,000 for singles and from
$433,000 to $575,000 for couples. This represents an increase in the lower assets test threshold of $101,500 and
$142,000 for singles and couples respectively.
For those with lower levels of assets, these changes may result in an increased rate of age pension. The
Government has also confirmed the comparatively larger increase in the lower assets test level for
non-homeowners is in recognition of higher living costs.
Asset test taper rate
The asset test taper rate, the amount by which a person’s pension entitlement decreases under the assets test is
proposed to increase as outlined above.
Under these proposed changes the asset test taper rate will return to 2007 levels and will result in a substantial
reduction in the upper assets test threshold. This table sets out the current and proposed asset test thresholds:
Current Lower Proposed Lower Current Proposed
threshold threshold Cut-off limit Cut-off limit *
Single Homeowner $202,000 $250,000 $755,500 $547,000
Single Non-Homeowner $348,500 $450,000 $922,000 $747,000
Couple Homeowner $286,500 $375,000 $1,151,500 $823,000
Couple Non-Homeowner $433,000 $575,000 $1,298,000 $1,023,000
*Based on 1 January 2017 RATES
Concession cards
The government estimates that approximately 12 % of pensioners will
lose entitlement to the pension as a result of the changes to
the asset test. These people will automatically be issued with a
Commonwealth Seniors Health Card, or a Health Care Card for
those under pension age.
Previously announced changes to income test free areas and
deeming thresholds
Due to the changes in the pension asset test, the government
will not proceed with changes to the pension income test free
areas and deeming thresholds that were announced in the 2014
Federal Budget.
Wagga Wagga | Cootamundra | Young | Cowra | Harden | Coolamon | Sydney 4
NEWSLETTER | BUDGET 2015/16
HAVE YOU VISITED OUR WEBSITE? www.twomeys.com.au
OTHER THINGS YOU SHOULD KNOW
No Cuts to personal Income tax
Under the budget there are no changes to the tax rates
for individuals.
Netfix tax
From 1 July 2017 a “Netfix tax” will be introduced. The
tax will add ‘Intangible’ items bought from overseas
websites. This new tax will level the playing field and
raise $350 million over the next four years. The expansion
of GST will affect books, movies, music and TV programs
downloaded from the internet.
Claiming car expense deductions
From the 2015/16 income year, you will only be able to calculate work-related or business car expense
deductions by either the ‘cents per kilometre method’ at 66 cents per kilometre for all cars or by the log book
method. You will no longer be able to claim via the 12% of cost method or the 1/3 of actual expenses method.
Strengthen anti-avoidance measures
The Budget has provided for stronger anti-avoidance measures to ensure all Australian are using the welfare
and tax system in a fair way. The strengthening also applies to multinational companies who through contrived
arrangements, divert profits that are made in Australia.
Other FBT Changes
From 1 April 2016, the Government will introduce a separate single grossed-up cap of $5,000 for salary
sacrificed meal entertainment and entertainment facility leasing expenses (meal entertainment benefits)
for employees of certain non-for-profit organisations (public and non-for-profit hospitals, public ambulance
services, public benevolent institutions and registered health promotion charities). Where these benefits exceed
the separate grossed-up cap of $5,000, they can also be counted in calculating whether an employee
exceeds their existing (relevant) FBT cap. Furthermore, all meal entertainment benefits will become reportable.
For personalised information on how the budget impacts Accounting
you please contact your nearest Twomeys office.
Cootamundra.................................................. 02 6942 0300 Advanced Tax Planning
Wagga Wagga................................................ 02 6927 0500 Asset Protection and
Young................................................................. 02 6381 4200 Business Structures
Coolamon......................................................... 02 6927 3207
Audit and Assurance
Cowra................................................................ 02 6342 3728
Harden.............................................................. 02 6386 2485 Business Advisory
Sydney............................................................... 02 8006 7545
Finance*
Liability limited by a scheme approved under Professional Standards Legislation.
Please note that any taxation and accounting services are not endorsed nor the Information Technology
responsibility of Count Financial Limited. The articles con-tained in this newsletter are
intended for information only and not for advice.
Self-Managed
^Services provided as an Authorised Representative of Count.
Twomeys ABN 62 128 381 868 is a Member of Count Financial Superannuation
Limited (AR 324761). ‘Count’ and Count Wealth Accountants®
are trading names of Count Financial Limited ABN 19 001 974 625
Australian Financial Services Licence Holder Number 227232 a
Taxation
wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of
Australia ABN 48 123 123 124. Count is a Professional Partner of the
Financial Planning Association of Australia Limited. Count advisers
Wealth Creation^
are authorised representatives of Count. www.count.com.au *Lending services are authorised by Finconnect
(Australia) Pty Ltd ABN 45 122 896 477 Australian Credit Licence No. 385888 a wholly owned subsidiary of Wealth Protection^
‘Count’ Count Financial Limited is not responsible for any accounting & tax services.
You can also read
