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Tax Update: Budget 2021

 

On 11 May 2021, the Australian Government released its Federal Budget for the 2021/22 year and here are some of the key taxation policies that may affect you.

 

For Individuals

 

  • The Low and Middle-Income Tax Offset (LMITO) will continue to apply for the 2021/22 financial year, which provides tax offsets of up to $1,080 for individuals or $2,160 for dual-income earners.
  • From 1 July 2022, low-income earners who earn less than $450 per month will be entitled to receive Superannuation Guarantee Charges payments from their employers.
  • From 1 July 2022, the minimum age of the downsizer superannuation contribution will be lowered from 65 to 60 years old.
  • Australians aged 67 to 74 will have the ‘work test’ removed for non-concessional and salary sacrificed superannuation contributions to allow for flexibility in making superannuation contributions.

 

For Businesses

 

  • From 1 July 2022, employers are required to pay the Superannuation Guarantee Charge to employees earning less than $450 per month.
  • Eligible businesses can continue to deduct the full cost of eligible assets, including the cost of improvements to existing assets, incurred between 7.30 pm (AEDT) on 6 October 2020 and 30 June 2023. Eligible businesses are businesses with turnover or statutory and ordinary income below $5 billion.
  • Companies with turnover below $5 billion can also continue to recoup tax previously paid on prior-year profits, as far back as the 2018/19 income year, using 2022/23 tax losses.

 

Contact Us

 

If you would like to know how these tax measures can affect your estate planning or business restructuring, contact one of our friendly taxation solicitors for more information:

You can also view more information about our Tax services here.

Related Blog – Resumption of Tax Compliance Activities by the ATO

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