Reward for work is a dominant theme in this year’s Budget. The seven year personal income tax plan initially targets low to middle income earners before making significant changes to the tax brackets.
As you would expect from an election budget, there is not a lot of bad news or serious cuts.
There are also a number of tax changes to close loopholes and while not presented in the budget, the Treasurer has flagged the release of a discussion paper that will explore options for taxing digital business in Australia. There will be more to come – just not this year and possibly not with this government!
Key initiatives that may impact you
- Seven year personal tax cut plan. The anticipated personal income tax cuts will be delivered as part of a seven year plan culminating in the removal of one tax bracket from 1 July 2024 – it’s a long way off!
- $20k accelerated depreciation extended until 30 June 2019 – remember this is a deferral not a saving.
- A limit of $10,000 will be introduced for cash payments made to businesses for goods and services from 1 July 2019. Payments above the threshold will need to be made through an electronic payment system or by cheque.
- Employers who do not keep up with their PAYG obligations will not be able to claim a tax deduction for payments to employees (such as wages).
- From 1 July 2019 the following industries will be required to lodge annual reports to the ATO with their contractors details:
- Security providers and investigation services;
- Road freight transport; and
- Computer system design and related services
- Introduction of a 3-year cycle for SMSFs with a history of good record keeping and compliance.
- Expanding the SMSF member limit from four to six
Our detailed budget paper can be accessed below.
This document contains general advice only and is prepared without taking into account your particular objectives, financial circumstances and needs. The information provided is not a substitute for legal, tax and financial product advice. Before making any decision based on this information, you should speak to a licensed financial advisor who should assess its relevance to your individual circumstances. While The Field Group believes the information is accurate, no warranty is given as to its accuracy and persons who rely on this information do so at their own risk. The information provided in this bulletin is not considered financial product advice for the purposes of the corporations Act 2001.