To stimulate investment
Instant Asset Write Off for all Business under the $5 Billiion Turnover
From the 7th October until 30th June 2022, it is proposed all businesses are eligible to write off ANY asset purchased from 7th October up to 30th June 2022 in FULL to encourage investment by businesses in the economy.
This is a tax deduction and will reduce your taxable income only.
Any balance of pools for small business can also be written off up to 30th June 2022.
What this means? If you are a builder and need to invest in new equipment valued at $50,000 and you trade via a Company, this can save you $13,750 in Tax.
Further info refer
To stimulate hiring
JobMaker Hiring Credit
This is aimed to get young Australians from Jobseeker into the workforce. Eligible employers can claim a Jobmaker Hiring Credit for each additional new job they create for an ‘eligible employee’ from 7th October 2020 to 6th October 2021.
$200 weekly credit for eligible employees aged 16 – 29 years or $100 per week if hire an eligible employee 30 – 35 years. Capped at $10,400.
Not eligible to claim Jobmaker if on Jobkeeper.
Must meet additional criteria ie increase in total headcount, registered for PAYG withholding, up to date with tax lodgements and reporting via STP (Single Touch Payroll).
The hired employee must work at least 20 hours per week and been in receipt of eligible Centrelink Support Payments prior to commencement. 1 month out of 3 months prior to being hired.
To be claimed quarterly in arrears via the ATO from 1st Feb 2021.
Boosting Apprentice Wage subsidy
The Boosting Apprenticeship wages subsidy is for any new apprentice you hire after the 5th October 2020. This can be a 1st year brand new apprentice or an apprentice that you take on who is mid-way through an apprenticeship. The subsidy is 50% of the gross wages paid from 5th October 2020 to 30th September 2021, up to a maximum of $7,000 per Quarter. The amounts will be paid at the end of each Quarter via your Apprenticeship provider.
It’s important to note this scheme will be limited to the 1st 100,000 Apprentices.
On top of this we still have the Supporting Apprentices & Trainees program that commenced in March 2020. For those of you with Apprentices at 1 July 2020 who are no longer receiving Jobkeeper payments will go back to the 50% wage subsidy up to $7,000 per Quarter per apprentice. This will be paid at the end of each Quarter and is available until March 2021.
So if you have an existing apprentice they will either be getting Jobkeeper (extension), or the previously announced 50% of gross wages rebate.
FBT Exemption for Retraining/Reskilling Employees
From 2nd Oct, 2020, FBT Exemption for retraining/reskilling benefits provided by an employer to redundant or soon to be redundant employees (retrain a sales assistant in web design to redeploy into online marketing)
Currently FBT Payable if no sufficient connection to current employment or soon to be redundant employees.
This exemption will not extend to retraining acquired by way of salary packaging arrangement or Commonwealth supported places.
Individuals may also be eligible to claim tax deduction for re-education and training they incur if not related to current employment but relates to future employment.
Temporary loss carry back for “Eligible Companies’
Companies with turnover less then $5 billiion can carry back losses made in 2020, 2021 and 2022 Financial Year to offset previously taxed profits made in or after the 2019 Tax Year.
The result – a refundable offset in the year which the loss is made in 2020, 2021 or 2022.
Available by election upon lodging your company tax return for 2021 and 2022.
Support for mental health of Australians in Small Business
Free and accessible and tailored support for small business owners
Insolvency Reforms to support small business
From 1st Jan, 2021
Simplified Streamlined Process to enable those with less then $1 million of liability to restructure debt.
Simplify liquidation process for eligi8ble incorporated small businesses (faster and lower-cost liquidations).
Support for insolvency sector.
If you are considering hiring or need some additional equipment for your business, please contact us to make an appointment to help you through the options.
Individuals Non-Business
Personal Income Tax Cuts
An increase in 19% bracket from $37,000 to $45,000.
An Increase in 32.5% bracket from $90,000 – $120,000.
Low and Middle income tax offset planned removal will remain in place for this 2021 financial year.
If you want to find out how much tax you will save, access this tax estimator calculator.
https://budget.gov.au/calculator/index.htm
Removing CGT for “Granny Flat Arrangements”
A targeted CGT Exemption will apply from 1st July 2021, (subject to legislation passed). This is for older Australians or people with disabilities transferring their home or proceeds from sale of their home to their adult children or other trusted persons in return for the promose of ongoing housing and care.
This change will only apply to family/personal ties and not commercial.
Superannuation Reforms
Superannuation account stapled to employee and follow you when you change employment.
A new interactive online “YourSuper” comparison tool .
Holding Funds for underperforming accounts.
Extra Cash for Pensioners
Pensioners will receive another 2 x $250 lump sum cash payments. One before xmas and the other in early 2021
This will be available to Age Pension, Disability Pension, Veterans, People on Carer payments & Family Tax benefit recipients.
Self Funded retirees can also potentially benefit, with Commonwealth Seniors Health Card & Pensioner concession card holders also qualifying for the payments.
*Note, the above is provided as general advice only and is subject to Royal Assent. Please contact our office shall you require specific advice in your situation.