- Release of the 2013-14 Federal Budget, a few things which may affect you:
Personal:
- The increase in the tax-free threshold from $18,200 to $19,400 as from 1 July 2015 will not proceed and will instead be “deferred”
- The increase in the second marginal tax rate from 32.5% to 33% from 1 July 2015 will still go ahead.
- Scrapping of the planned Family Tax Benefit Part A increase.
- The age eligibility for the Family Tax Benefit Part A will change to include children aged 16 years and over, as of 1 January 2014.
- Seniors downsizing from a family home – means test exemption, trial program from 1 July 2014.
Health:
- Medicare Levy increase to by 0.5% to 2% confirmed to fund disability care as of 1 July 2014.
- Phase-out of medical expense tax offset
- Medicare levy low-income threshold for families increase to $33,693 for the 2012-13 income year, with effect from 1 July 2012, plus an additional amount for each dependent child or student will increase to $3,094.
- Baby Bonus to be abolished from 1 March 2014 will be and replaced with an increase in the Family Tax Benefit Part A payments.
Education:
- HELP discounts to be abolished for upfront payments and voluntary payments
- Self-education expenses will be capped to $2,000 on tax deduction claims for work-related self-education expenses per person per income year from 1 July 2014. Deductible education expenses are costs incurred in undertaking a course of study or other education activity, such as conferences and workshops, and included tuition fees, student amenity fees, textbooks, professional and trade journals, travel and accommodation expenses, computer expenses and stationary, where these expenses are incurred in the production of the taxpayer’s current assessable income.
Business:
- Corporate tax entities with turnover of more than $1bn will move to monthly PAYG instalments from 1 January 2014.
- The Government will provide $67.9m over 4 years to the Tax Office to undertake compliance activity in relation to trust structures. The task force will target the exploitation of trusts to conceal income, mischaracterise transactions, artificially reduce trust income amounts and underpay tax.