It’s a bit like 1996 on repeat with Howard and Costello’s first budget after replacing a long-standing government, just get into office first and don’t rock the boat significantly.
Two years later (1998) they went to the polls on tax structural reform (GST) and I expect Jim Chalmers is thinking the same way as clearly the unaddressed cost of living pressures and major deficits just won’t magically disappear… unless… like Howard/Costello we Aussies luck out with another sustained mining boom….
No doubt, more interesting years ahead.
The Budget
Well, it’s getting a bit ridiculous with 4 federal budgets in 2 years even us accountants are struggling to get budget night excited!
Here are some highlights:
Super downsizer contributions eligibility age reduction to 55 confirmed
The proposed reduction in the eligibility age will allow individuals aged 55 or over to make an additional non-concessional contribution of up to $300,000 from the proceeds of selling their main residence outside of the existing contribution caps. Either the individual or their spouse must have owned the home for 10 years.
As under the current rules, the maximum downsizer contribution is $300,000 per contributor (i.e. $600,000 for a couple), although the entire contribution must come from the capital proceeds of the sale price. A downsizer contribution must also be made within 90 days after the home changes ownership (generally the date of settlement).
Paid parental leave and childcare
The government is investing over $530 million over 4 years from 2022–23 to expand Australia’s paid parental leave scheme to 26 weeks by 2026. This will happen under a staggered plan which will see the addition of two extra weeks to the program every year starting in July 2024.
The six months paid parental leave is also set to become more flexible, meaning parents will be able to share it more equitably between each other.
Tax
As expected, Labour has not made any changes to the stage three 2024 tax cuts in this budget (Yet!)
Instead, as promised, it has cracked down harder on tax abuse by multinationals and the rich as it looks to raise over $4 billion in extra revenue.
Where to get the full Budget
The 2022-23 October Budget Papers are available from the following website: https://budget.gov.au/
How to beat current economic conditions
You don’t know how good the good times are unless you have some tougher times (Inflation / Interest rate rises) with our Dr Steven Enticott & Mike Loder (Ticker News)
The three B’s of Buffer, Budget & Build: https://www.youtube.com/watch?v=uNCjvzSeWZ0
How to be a sustainable business
It’s easier than you think with our Dr Steven Enticott & Mike Loder (Ticker News) To measure, reduce, offset and adopt a climate positive project: https://youtu.be/yL07CbAjC6M
For any clients who are affected by the VIC floods.
https://business.vic.gov.au/grants-and-programs/small-business-immediate-flood-relief-program
To be eligible for a grant, businesses must:
- be located within a local government area deemed eligible for assistance under the Disaster Recovery Funding Arrangement
- hold an active Australian business number (ABN) and have held that ABN on and from 14 October 2022
- be registered for Goods and Services Tax (GST) on and from 14 October 2022
- have incurred significant direct damage from flooding to the place of business, business assets, stock or equipment.
List of eligible LGAs:
(There are quite a few here, not just the obvious ones like Shepparton etc)
FBT tax free electric cars
The Government has announced a proposal to:
- remove fringe benefits tax (FBT) on eligible electric cars from 1 July 2022, and
- include the value of these exempt car fringe benefits in the calculation of an employee’s reportable fringe benefits amount.
This measure is not yet law. If enacted, this will apply from the FBT year beginning 1 April 2022.The Government intends to review this exemption after 3 years, to consider electric car take-up.
ttps://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6876
20% training tax deduction boost
Subject to law, small businesses with an aggregated annual turnover of less than $50 million will be able to deduct an additional 20% of expenditure incurred on eligible training courses provided to employees.
Small Business Technology Investment Boost
Subject to law, small businesses (with aggregated annual turnover of less than $50 million) will be able to deduct an additional 20 per cent of the cost incurred on business expenses and depreciating assets that support their digital adoption, such as portable payment devices, cyber security systems or subscriptions to cloud based services.
Businesses may continue to deduct expenditure that is ineligible for the bonus deduction under the existing tax law. We will provide further details on eligible expenses once the law has passed.
Director ID cut off dates
With the 30 November 2022 deadline approaching, SMSFs and other company directors are being reminded to obtain their director identification number by this date. Also includes those directors who on or before 31 October 2021 but have since resigned.
The director ID laws that were passed back in June 2022 require all directors of companies in Australia to obtain an ID number including SMSF members who are directors of a corporate trustee also include those who were a company director on or before 31 October 2021, but have since resigned.
Tax return deadline
For those who did not use a tax agent last year and those who did but were significantly late in doing so the tax return deadline is effectively this Friday as the office is closed for the 4-day cup weekend.
If this is you, contact us today and we will add you to our extension list with the ATO!
Cup Weekend CIA tax (as is our tradition) will be closed for the 4 day cup weekend and re-open Wednesday 2nd of November after the tax frenzy (from July onwards!) our brains really need a mini-break