With there being so many changes to tax as presented in the Federal Budget, this is a concise summary of those that may have the biggest impact or relevance to you.
• The government will provide an income tax exemption for qualifying grants made to primary producers and small businesses affected by the storms and floods in Australia.
• The government will allow taxpayers to self-assess the tax-effective lives of eligible, intangible depreciating assets, such as patents, registered designs, copyrights and in-house software.
• The government will remove the cessation of employment taxing point for the tax-deferred Employee Share Schemes (ESS) that are available for all companies.
• The government will extend the power of the Administrative Appeals Tribunal (AAT) to pause or modify ATO debt recovery action, in relation to disputed debts that are being reviewed by the Small Business Taxation Division (SBTD) of the AAT.
• The government will replace the individual tax residency rules with a new, modernised framework.
• The government will increase the Medicare levy low-income thresholds for singles, families, and seniors and pensioners from 1 July 2020 to take account of recent movements in the CPI.
• The government will remove the exclusion of the first $250 of deductions for prescribed courses of education.
• The government will extend the 2020-21 Budget measure known as the JobMaker Plan, with temporary full expensing to support investment and jobs for 12 months until 30 June 2023.
• The government will extend the 2020- 21 Budget measure titled JobMaker Plan — temporary loss carry-back to support cash flow.
» The extension will allow eligible companies to carry back (utilise) tax losses from the 2022-23 income year to offset previously taxed profits as far back as the 2018-19 income year when they lodge their 2022-23 tax return.
» Loss carry-back encourages businesses to invest, utilising the 2021-22 Budget measures, known as Temporary full expensing extension by providing eligible companies earlier access to the tax value of losses generated by full expensing deductions.
Need tax advice speak with your LT Tax Accountant. Contact us today.