Increasing the Medicare levy low-income thresholds
The Government will increase the Medicare levy low-income thresholds for singles, families and seniors and pensioners by 2.9% from 1 July 2025 as follows: • The threshold for singles will be increased from $27,222 to $28,011. • The family threshold will be increased from $45,907 to $47,238. • For single seniors and pensioners, the threshold […]
Previously announced tax cuts in 2027 and 2028
The Budget referenced the Government’s previously announced tax cuts (which have already been legislated), as follows: • The (current) 16% tax rate will be reduced to 15% from 1 July 2026. • The 15% tax rate will be further reduced to 14% from 1 July 2027. For reference, the personal income tax rates for the […]
$1,000 Standard Deduction for Work-related Expenses
The Government will introduce a standard tax deduction of up to $1,000 for work-related expenses from the 2027 income year. Draft legislation and explanatory materials have been released for consultation regarding this measure: Treasury Laws Amendment Bill 2026: standard deduction for work-related expenses. The Draft Bill proposes to amend the tax law to introduce a […]
Introducing a Working Australians Tax Offset
The Government will introduce a $250 Working Australians Tax Offset with effect from the 2028 income year. This new offset will provide a permanent annual tax offset for Australians for their income derived from work such as salary and wages and the business income of sole traders.
Reforming the taxation of discretionary trusts
The Government will introduce a minimum 30% tax on discretionary trusts. From 1 July 2028 (i.e., from the 2029 income year), trustees will pay a minimum tax of 30% on the taxable income of discretionary trusts. Beneficiaries, other than corporate beneficiaries, will receive non-refundable credits for the tax payable by the trustee. Under the minimum […]
Reforming negative gearing for residential property investments
From 1 July 2027, losses from established residential properties will only be deductible against rental income or the capital gains from residential properties. Excess losses will be carried forward and are able to be offset against residential property income in future years. These changes will apply to established residential properties acquired from 7:30 PM (AEST) […]
Foreign resident CGT regime
The Government will provide a time-limited, targeted concession in the foreign resident CGT regime for investment in the renewables sector. The transitional arrangement will apply to foreign investors disposing of certain renewable energy infrastructure assets from commencement, being the first day of the next quarter after Royal Assent until 30 June 2030.
Replacing the 50% CGT discount with indexation
From 1 July 2027, the 50% CGT discount will be replaced by cost base indexation for assets held for more than 12 months, with a 30% minimum tax on net capital gains. These changes will apply to all assets, including pre-CGT assets, held by individuals, trusts and partnerships. Transitional arrangements will limit the impact on […]
Businesses using cash to dodge obligations
The ATO is ‘cracking down’ on businesses that use cash to avoid meeting their tax, employer and business obligations. Businesses that do this may: fail to report all sales transactions and fail to issue receipts; avoid paying GST, income tax, PAYG withholding, super guarantee, insurance and work cover protection; report their income below the $75,000 […]
Check GST credit claims before lodging BAS
Taxpayers who are registered for GST can claim GST credits (or ‘input tax credits’) for the GST included in the price of goods and services they buy for their business. However, if they buy something for both business and private use, they need to apportion their GST credit to only claim the business use. For […]
Government payments programs
The ATO is reminding taxpayers that receive government payments for delivering services under a Commonwealth program, such as healthcare, disability support or child care, that they have an obligation to: keep accurate records; and report any such income they receive in their tax return. The ATO recently advised that it would be contacting taxpayers […]
Contractors omitting income
Through data matching, the ATO is seeing some contractors incorrectly reporting or omitting contractor income. Contractors need to report all their income in their tax return, including payments made by businesses for their contracting work. Note that, as part of the taxable payments reporting system (‘TPRS’), certain businesses must lodge a ‘Taxable payments annual report’ […]