The 2017/18 Federal Budget has recently been revealed this week.
Some continuation across the board from last budget, with small businesses continuing to benefit from lower tax rates resulting in more cash flow being available for investment & expansion. Bad news for those with student / HELP loans unfortunately and a lot more funding being given to the ATO for audits targeting the black economy.
Below is a summary to help see what areas of the budget will effect small business & individual taxpayers.
2016/17 Financial Year
- Increasing the small business entity turnover threshold from $2m to $10m (allowing more businesses to claim the $20,000 immediate deduction for assets)
- The company tax rate will be cut to 27.5% for small businesses with a turnover of less than $10m
2017/18 Financial Year
- The $20,000 instant asset write-off, previously set to finish on 30 June 2017, has been extended into the 2018 tax year
- Funding for Government Projects of $1.6 billion for WA transport infrastructure, including METRONET and better road access to Fiona Stanley Hospital have been approved
- Taxpayers can now make additional super contributions of $15,000 per annum up to a total of $30,000 in order to fund a new home / save for a deposit and can be withdrawn from 1 July 2018. These contributions will count towards the relevant contributions caps.
- From 1 July 2017, travel expenses relating to inspecting, maintaining or collecting rent for a residential rental property will be disallowed.
- From 1 January 2018, the government will increase the CGT discount from 50% to 60% for resident individuals who elected to invest in qualifying affordable housing.
2018/19 Financial Year
- The HELP repayment threshold has been reduced from $54,869 to $42,000 on 1 July 2018, a perhaps necessary measure to fund the growing ‘unrecoverable’ debt of student loans
- The immediate asset write-off will be reduced from $20,000 down to $1,000 from 1 July 2018
- A person aged 65 or over will be eligible to make a Non Concessional Contribution of up to $300,000 from the proceeds of selling their home, where they have owned the property for 10 years or more.
2019/20 Financial Year
- Increase in the compulsory Medicare Levy from 2% to 2.5% from 1 July 2019
Should you wish to discuss how the above budget changes affect your personal situation, please do not hesitate to contact our office.