Let’s Recap the 2022-2023 Federal Budget
The Treasurer Josh Frydenberg delivered the Federal Budget on Tuesday 29th March 2022. Below we’ve summarised as to how this will affect you as a an individual and a business owner.
Individuals
Increasing Medicare Levy Low-Income Thresholds
The Medicare levy low-income thresholds will be increased for singles, families, seniors and pensioners from 1st July 2021. If an individual or family’s taxable income is below the low-income threshold will not have to pay the Medicare levy. More information? Read Here.
Cost of Living Tax Offset
The Government has announced that it will increase the low and middle-income tax offset (LMITO) for the 2021–22 income year by $420 to $1,500.
- All LMITO recipients will benefit from the full $420 increase, unless the full offset is required to reduce a taxpayer’s tax liability to zero.
- LMITO are those who generate a taxable income below $126,000 per-annum.
The LMITO will be received on assessment after the individual lodges their tax return for the 2021–22 income year. More information? Read Here.
$250 Cost of Living Payment
To assist with the higher cost of living pressures, the Government will provide eligible recipients with a tax-exempt support payment of $250.
The payment will be made to eligible Australian resident recipients of the following payments and to concession cardholders:
- Age Pension
- Disability Support Pension
- Parenting Payment
- Carer Payment
- Carer Allowance (if not in receipt of a primary income support payment)
- Jobseeker Payment
- Youth Allowance
- Austudy and Abstudy Living Allowance
- Double Orphan Pension
- Special Benefit
- Farm Household Allowance
- Pensioner Concession Card (PCC) holders
- Commonwealth Seniors Health Card holders
- Eligible Veterans’ Affairs payment recipients and Veteran Gold card holders.
Expansion to Home Guarantee Scheme
The Government will expand the existing Home Guarantee Scheme to:
- Increase the number of available guarantees from 10,000 to 35,000 each year to support eligible first home buyers to purchase a new or existing home with a minimum deposit five per cent — from 1 July 2022.
- Expand the Family Home Guarantee by providing 5,000 guarantees to support eligible single parents with children to buy their first home or to re-enter the market with a minimum deposit of two per cent — from 1 July 2022 to 30 June 2025.
- Establish a new Regional Home Guarantee which will provide 10,000 guarantees each year to support eligible home buyers to purchase or construct a new home in regional areas — from 1 October 2022 to 30 June 2025.
More information? Read Here.
Business
Technology Investment Boost
The Government has announced that it will introduce a technology investment boost to encourage digital adoption by small businesses.
- Small businesses with an aggregated annual turnover of less than $50 million will be able to deduct an additional 20 per cent of expenditure incurred on business expenses and depreciating assets that support their digital adoption up to an annual cap of $100,000 of expenditure.
- Businesses can claim the 20 per cent boost in respect of eligible expenditure incurred:
– By 30th June 2022 – the boost will be claimed in the tax return for the following income year;
-Between 1st July 2022 and 30th June 2023 — in the income year in which the expenditure is incurred.
More information? Read Here.
Skills and Training Boost
The Government has announced that it will introduce skills and training boost to support small businesses to train and up skill their employees.
- Small businesses with an accumulated annual turnover of less than $50 million will be able to deduct an additional 20 per cent of expenditure incurred on eligible external training courses provided to their employees.
- Businesses can claim the 20 per cent boost in respect of eligible expenditure
– incurred by 30th June 2022 —in the tax return for the following income year;
– incurred between 1st July 2022 and 30th June 2024 — in the income year in which the expenditure is incurred.
More Information? Read Here.