Happy New Financial Year!
Deficit Levy to be abolished – thus resulting in a 2% tax cut for individuals with taxable income in excess of $180 000.
On 6 June 2017, the Fair Work Commission handed down its annual wage review. The decision varied the following:
- Minimum wage rates in Modern Awards – increased by 3.3% from first full pay period commencing on or after 1 July 2017 (rounded to the nearest 10 cents)
- National minimum wage – increased by 3.3% to $694.90 per week, or $18.29 per hour
- Wages for juniors, apprentices – most rates are expressed as a percentage of nominated adult rate so they receive a proportionate increase to the adult rate
- Wages for trainees and piece workers – most trainees are covered by the National Training Wage system that is included as a schedule in most awards. National Training Wages will also be increased by 3.3% from the first pay period on or after 1 July 2017. Piece rates will increase in accordance with the relevant provisions in the modern award, pay scale or transitional award.
- Supported wage system – employees with a disability: these employees are paid a percentage of the relevant adult wage, based on their assessed capacity. The 3.3% increase will also flow through to these employees.
- Simpler BAS commences and is compulsory for all SBEs with a turnover of less than $10 million
- GST to apply to digital products and other services imported by Australian consumers – businesses will need to quote their ABN to avoid GST
- Removing the double taxation on digital currency such as Bitcoin
Rental Property Deduction Crackdown
- Deductions for travel expenses related to inspecting, maintaining or collecting rent for a residential rental property will be disallowed. This measure will not prevent investors from engaging third-parties such as real estate agents for property management services.
- Limiting plant and equipment depreciation deductions to outlays actually incurred by investors
First Home Saver Scheme to Commence
Voluntary super contributions made from 1 July 2017, will be able to be withdrawn as a deposit for a first home. More information.
- Introduction of a $1.6 million transfer balance cap
- Removal of tax exemption for Transition to Retirement pension earnings
- Concessional (before tax) contribution cap reduced to $25 000 for all taxpayers
- Allowing catch-up concessional contributions – ideal for those who have had time out of the workforce (e.g. parents with newborns)
- Non-concessional (after tax) contribution cap reduced to $100 000
- Extending the spouse tax offset – reduce your own tax liability by making a super contribution on behalf of your spouse
- Many more taxpayers (including employees) now able to claim a deduction for their voluntary superannuation contributions up to the $25 000 cap.