On 2 April 2019, the Treasurer, Mr Josh Frydenberg, delivered his first Federal Budget and the first Federal Budget of the Morrison Government.

As the Morrison Government heads towards an election (yet to be announced but forecast for May 2019), the budget sets out their agenda for a future term in office with a focus on returning the budget to surplus while delivering income tax relief to low and middle income earners.

We have prepared an in-depth budget report for you to download and highlighted below some of the key policy decisions that may impact you or your business.

Note that the implementation of these announcements is dependent on the Morrison Government winning the next general election as well as the passage of legislation through parliament.

Taxation

• The legislated Personal Income Tax Plan will be changed to further lower taxes for individuals, including changes to the low and middle income tax offset, the low income tax offset and the personal income tax rates and thresholds.
• The instant asset write-off threshold for businesses with an aggregated turnover of less than $10m will be increased to $30,000 for eligible assets that are first used, or installed ready for use, from 7.30 pm (AEDT) on 2 April 2019 to 30 June 2020.
• Businesses with an aggregated turnover of $10m or more but less than $50m will be able to immediately deduct purchases of eligible assets costing less than $30,000 that are first used, or installed ready for use, from 7.30 pm (AEDT) on 2 April 2019 to 30 June 2020.
• The Medicare levy low-income thresholds for singles, families, seniors and pensioners will be increased from the 2018/19 income year.

Superannuation

• Members of regulated superannuation funds will not have to meet the work test after 1 July 2020 if they are 65 or 66 years of age.
• The restrictions on claiming the spouse contribution tax offset will be eased from 1 July 2020, giving 70 to 74 year old spouses eligibility.
• Members aged 65 or 66 years of age will be able to access the $300k bring forward rule from 1 July 2020.
• The calculation of exempt current pension income will be simplified for superannuation funds from 1 July 2020, allowing a preferred method of calculation and removal of some actuarial certificates.

Black economy measures

• Australian Business Number (ABN) holders will be required to lodge their income tax return and confirm the accuracy of their details on the Australian Business Register annually to retain their ABN status.
• The start date of amendments to Division 7A will be delayed by 12 months to 1 July 2020.
• The ATO will receive funding to increase activities to recover unpaid tax and superannuation liabilities with a focus on large businesses and high wealth individuals.

Other announcements

• There will be a one-off Energy Assistance Payment of $75 for singles and $62.50 for each member of a couple eligible for qualifying payments on 2 April 2019 and who are resident in Australia.
• Single Touch Payroll reports lodged by employers will be shared with social security agencies from 1 July 2020.

Further information

If you would like further information on any of the announcements highlighted above, our comprehensive budget report can be downloaded here.

Should you wish to discuss the impact of these announcements on your personal tax position, please contact us on 07 3831 1055 or at [email protected].

DISCLAIMER: The information on this website and the links provided are for general information only and should not be taken as constituting professional advice from Hall Browns Accountants. You should consider seeking the appropriate legal, financial, or taxation advice to check how the website information relates to your unique circumstances.