Personal Income Tax Measures:
- The Government intends to implement new tax cuts for individual taxpayers in the 2027 and 2028 income years.
- The 16% tax rate applicable to incomes between $18,201 and $45,000 is proposed to be reduced to 15% from 1 July 2026.
- This rate is further proposed to be reduced to 14% from 1 July 2027.
- This is useful for trusts and family tax planning.
- The Medicare levy low-income thresholds will increase from 1 July 2024.
- This adjustment will potentially result in more low-income individuals and families being exempt from the Medicare levy or paying a reduced levy.
ATO audits – pay attention!
Additional funding will be provided to the ATO to enhance its capacity to address tax avoidance and non-compliance. This includes measures to strengthen tax integrity through:
- Extension and expansion of the Shadow Economy Program – this is relating to unrelated cash, or payment terminals not reported in Xero/MYOB/QBO etc.
- Extension and expansion of the Personal Income Tax Compliance Program – this is for bogus deductions and unsubstantiated claims. Keep copies of everything!
- Extension of the Tax Avoidance Taskforce – this is for people not reporting crypto, share sales, personal vehicles bought in company ABN, etc.
Other Tax-Related Budget Measures:
- The Government is allocating $6.7 million over four years from the 2026 income year to extend the operation of the National Anti-Scam Centre.
- This initiative aims to protect consumers and businesses from scam activity.
- The Government will provide over $12 million over four years from the 2026 income year to support small businesses and franchisees. This funding will focus on:
- Strengthening the regulatory oversight of the Franchising Code of Conduct.
- Improving data analysis capabilities related to potential illegal phoenixing activity.
- Supporting social enterprises that offer employment to disadvantaged Australians.
- Consulting on options to extend protections for small businesses under the Franchising Code of Conduct.
- The Government intends to support the hospitality sector and alcohol producers through a pause on the biannual indexation of excise and excise-equivalent customs duties for beer, spirits, and wine for two years, commencing August 2024.
- The Government plans to ban non-compete clauses for workers earning below a specified income threshold (currently $175,000). This measure is intended to improve wage growth and job mobility for a significant portion of the workforce.
‘At XETA, we’re committed to helping AFA members stay ahead of the curve, comprehensively and strategically’, Zander De Klerk – Managing Partner & Director
Contact Zander HERE