It was a pretty typical pre election budget. Plenty of tax cuts promised, and nothing too controversial.
Here are some of the relevant tax proposals that could affect you...
Income tax cuts proposed in the government's seven year Personal Income Tax Plan.
- a targeted non-refundable offset aimed at low and middle income earners
- a modest increase in the 32.5 percent threshold
- larger increases to the thresholds to follow in 2022 and 2024
- removing the 37 percent bracket from 2024
Small business instant asset write-off extended until 30 June 2019 for business assets under $20K, and small business turnover threshold test increased to $10M (as per last year).
Black economy targeted with cash payments ban over $10,000
The Government has released its responses to the Black Economy Taskforce final report. The ATO will receive significant additional funding to combat the Black Economy with targeted review processes, data matching and specialist teams.
The key measure proposed is a cash payment limit of $10,000 to keep dishonest businesses from taking cash in hand, and not declaring this in their tax returns.
Other proposals include:
- expansion of the taxable payments reporting system to the road freight transport industry, the security and investigation industry, and the computer system design industry
- deductions for cash wage payments will be disallowed where the employer does not withhold the necessary PAYG
Superannuation There weren't too many changes to super; however here are a few:
- SMSF audits every three years. From 1 July 2019, certain Self Managed Super Funds (SMSF) would only be required to have an audit every three years. To be eligible you need to have a good compliance history.
- Inactive super accounts: from July 1, 2019, inactive accounts under $6,000 will be transferred to the Australian Tax Office to protect them from further erosion and data matching will be used to connect with a member's active accounts.
- Super costs: fees on super accounts under $6,000 will be capped at 3 per cent and exit fees will be banned on all accounts.
- SMSF member increase: the maximum number of SMSF members is going up from four to six.
Please call or email us to discuss how these changes will affect you.