We expect you would already have been reading about the Federal Budget 2017-2018 handed down on 9 May 2017. Below we have listed some of the key Budget items that will affect our clients.

Small Businesses

1. • The $20,000 instant asset write off has been extended until 1 July 2018, see eligibility details on our post: Now businesses with up to $10M turnover can access $20,000 instant asset write off
   • Levies have been introduced on businesses with employees on Temporary Skill Shortage visas or sponsoring employees under the Employer Nomination Scheme or the Regional Sponsored Migration Scheme. The levies apply to each relevant employee and the starting amounts are $1,200 to $3,000 per annum, depending on the visa type.
   • The Fringe Benefits Tax rate is expected to increase.
   • The requirement to report payments made to contractors remains, with closer scrutiny on the courier and cleaning industries.
   • From 1 July 2017 changes will apply to small business Capital Gains Tax concessions.
   • The economy will benefit from the $75 billion committed to infrastructure projects.

Individuals and Families

1. • Personal Income Tax Rates remain the same.
   • For those on annual incomes above $180,000, the 2 per cent Temporary Budget Repair levy remains scheduled to expire on 30 June 2017.
   • The Medicare levy is now scheduled for an increase on 1 July 2019, from 2 per cent to 2.5 per cent; the low-income thresholds are being increased for the 2017-2018 year.
   • For Australian residents eligible for qualifying payments, on 20 June 2017 the government will pay a one-off an Energy Assistance Payment – $75 for singles and $125 for couples.
   • A family income threshold of $350,000 per annum to qualify for the Child Care Subsidy has been introduced.
   • The indexation of Family Tax Benefit payments has been paused.
   • Eligibility criteria changes to the Age Pension and Disability Support Pension mean claimants now need to hold 15 years of continuous Australian residency to qualify – some exemptions apply.

Investors

1. • Investment property travel costs will shortly become non-deductible.
   • Deductions for depreciation of plant and equipment in residential rental properties is to be limited.
   • Individuals investing in affordable housing may qualify for a CGT concession – a number of criteria apply.

Superannuation

1. • The introduction of the First Home Super Savers Scheme will enable First Home Owners from 1 July 2018 to withdraw voluntary contributions they have made to super for a deposit.
   • Related party transactions subject to increased scrutiny.
   • For those over 65, from 1 July 2018 you can make a non-concessional super contribution of up to $300,000 from the proceeds of selling your home. This contribution will be excluded from the age test, work test and the $1.6 million balance threshold. It will not be exempt from the $1.6 million transfer balance cap.

If you would like more information or are unsure how the Budget will affect you, please call us on 03 5339 3200 or email us at mail@focusaccountinggroup.com.au.

Thanks for reading.

By Genna Kidd
 

Focus Accounting and Financial Group Pty Ltd is a Corporate Authorised Representative (No. 1254675) of Merit Wealth Pty Ltd (AFSL No. 409361).

The information contained on this website has been provided as general advice only.  The contents have been prepared without taking account of your personal objectives, financial situation or needs.  You should, before you make any decision regarding any information, strategies or products mentioned on this website, consult your own financial advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs.