- Changes to overseas working holiday tax
- Exciting new service offering at YML!
- Right Corporate Structuring
- Stamp Duty
- Annual Wage Review
- Interest Only Loans
- GOVERNMENT ANNOUNCES CHANGES TO THE WORKING HOLIDAY VISA MAKER PROGRAM
- Six Things that Can Keep a Business from Growing
- ATO ANNUAL REPORT
- How The Cloud and Automation Make Business Management Easier
- Avoiding the Wealth Creation Con Artists
- Why Business Owners Should Think Like Futurists
- Buying Property? Why You Should Care About Interest Rates
- Buying property through SMSF – what are the rules?
- 4 reasons to consider refinancing your home loan
- Big data for small business
- Does your super fund provide enough life insurance cover?
- HIFX - INTERNATIONAL PAYMENT EXPERTLY DONE
- Succession plan basics for small business
- Budget Alert – Should you put in place a Transition to Retirement strategy?
- FBT 2016 - WHAT YOU SHOULD KNOW
- How New Laws May Impact Your Use of an Earnout Right when Buying or Selling a Business.
- Transfer of Business Assets & Private Company Shares
- Financial Future Checklist
- Matters to Consider Before Setting Up an SMSF
- 6 Things that Work Better in The Cloud
- Can better inventory management improve business performance for Manufacturers?
- Should you register for GST?
- 5 Top Causes Of Stress for Small Business Owners Open page Preview for 5 Top Causes Of Stress for Small Business Owners
- 5 Reasons for Cash Flow Problems in Small Businesses
- Key man insurance, who do you need to insure?
- Finance options for buying a car
- Buying A Business? 5 Red Flags to Watch Out For
- Should You Take Your Small Business National?
- Upfront costs when buying a home and how you could save
- Insourcing vs outsourcing vs co-sourcing
- 7 Useful Web-Based Software Programs for SMEs
- Saving Tax Through Successful Loan Structuring
- Buy/sell agreements - do you need one?
- New Work Tax Exemption (WTE) granted to SMSF Members
- New Tax Relief Introduction – Parliamentary Bill 2019
- Australian Immigration Visa Changes from 1st July 2019
- Land Tax Surcharge and You
- YML Insight April 2015
- Tax Liabilities to be reported to Credit Agencies
- Business Process Improvement
- Intelligent Process Automation (IPA) is here to stay
- Carry forward your unused Concessional Contributions
- 2015 Federal Budget Report
- Business Valuation
- Skilled Nominated Migration (190 Visa) – Live & Work in NSW
- YML Insight June 2015
- Prepaying Interest
- Superannuation Contributions at EOFY
- Financial Year End Planning
- Small Business Cyber Security
- How Business Process Outsourcing can bring value to your customers through technology
- Equity Crowd-Funding
- Low and Middle Income Earners – Tax Offsets
- Mortgage Insurance
- RBA Cash Rate Reductions - What it means for your Loan
- Insurance in Super
- Gift or lend to your child?
- GENERAL SKILLED MIGRATION (GSM)
- Proposed Superannuation Guarantee Amnesty – Have you correctly paid your staff super?
- How RPA and Bots are making Employees happier
- Super Guarantee – What Happens When You Get It Wrong
- Business Process Outsourcing – Take the Technology View
- The Importance of Estate Planning
- PRINCIPAL-AND-INTEREST VS INTEREST-ONLY
- UPDATE YOUR WILL
- SAFE HARBOUR FOR DIRECTORS OF STRUGGLING COMPANIES
- COVID-19 and Estate Planning – Your Will
- ATO is Auditing Rental Property Expense Claims
- JobKeeper 2.0 – Extension 1 and Extension 2
- How a Mortgage can improve your Financial Position / How a Mortgage can grow your Wealth
- REMINDERS! LAND TAX REGISTRATION and DEED OF VARIATION
- 2020-21 Federal Budget – Update
- UPDATING SMSF TRUST DEEDS
- SMSF - $1.6 MILLION TRANSFER BALANCE CAP
- CONTRACTOR vs. EMPLOYEE – EMPLOYER OBLIGATIONS
- RPA for VEHICLE FLEET MANAGEMENT
- TRUST DISTRIBUTION IN 2018
- TAX PLANNING
- THE IMPORTANCE OF WITHDRAWING YOUR MINIMUM PENSION
- AUDIT INSURANCE – ATO Increasing Audit Activity in the Areas of Income Tax and Supe
- 5 Everyday Examples of IPA in Practice
- Deed of Variation – NSW Surcharge Land Tax
- Is Your SMSF Investment Strategy Compliant?
- GST on Property Transactions has changed from 1 July
- INVESTMENT LOANS – IS IT WORTH TAKING OUT PRINCIPAL + INTEREST at 3.89% RATE*?
- GLOBAL TALENT SCHEME – Get the expertise your company needs…
- Business Intelligence (BI) in Small Business
- It’s started – Single Touch Payroll (STP)
- CAR LOAN – HERE’S AN OFFER
- Should you pay principal + interest on your investment property?
- Over 65? Downsize your home to contribute to your super!
- NEW Skilling Australians Fund (SAF) Levy
- Limitations to the Superannuation Death Benefit
- Superannuation Guarantee Amnesty – Self-Correct your past Super Guarantee Liability
- Non-Residents and SMSFs – Tax Alert!
- Managing your Money through this Crisis!
- Proposed Partner Visa Changes – NEW Two-Step Process
- YML Insight – Special Edition COVID-19
- FBT 2020 – What do you need to consider?
- Annualised Salaries – New Rules from 1 March 2020
- Economic Stimulus Package – JobKeeper Payment
- Superannuation and Pension Payment Changes
- Should I ‘fix’ my home loan?
- Economic Stimulus Package – Small Business Grants
- Working with Remote Staff – Business Process Outsourcing
- ATO Payment Arrangements – Avoid Overseas Travel Ban
- JOBKEEPER INCENTIVE – ENROLMENT REQUIRED 30/04/20
- GOVERNMENT INCENTIVES UPDATE
- Taxable Payments – New Compliance for Couriers and Cleaners
- Superannuation Guarantee Amnesty 2020
- Government announces Changes to the Working Holiday Maker Programme
- NEWS! CGT Main Residence Exemption to End for Foreign Residents
- EOFY Removal of Main Residence CGT Exemption for Non-residents
- YML Insight July 2015
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- BUY / SELL Insurance – What is it and how can it help your business?
- YML Insight August 2015
- Working from home: What deductions can you claim?
- COVID-19 – Rent Moratorium + Financial Support
- Applying For A Mortgage Is No ‘Walk in the Park’
- MyGov – What is it and how do you apply?
- SMSF – Would it suit you?
- Economic Stimulus Package – Small Business Grants
- Small Business Instant Asset Write-Off : NOW up to $25,000
- POWER BI - BUSINESS DATA TOOL
- Employees : Time and Attendance Platforms
- COVID-19 – Travel Bans and Exemptions
- COVID-19 – Workers Compensation and JobKeeper
- Funding to help small businesses re-open after COVID-19
- Digital Automation supporting Remote Work
- The Importance of Estate Planning
- Buying Property through your SMSF
- FBT 2019 – What’s new?
- Tax Time Checklist for Individuals
- Single Touch Payroll – NOW Mandatory for ALL Businesses
- Economic Stimulus Package Updates
- Should I leave my savings in the offset or in the redraw?
- Tax Planning and Restructuring to suit your Business
- Federal Budget 2019 – Immigration to Australia NEWS
- NOW is the time to consider your Year-End Super Contributions
- Federal Budget May 2016 - Superannuation and Social Security
- Federal Budget 2014-15 Update
- Federal Election 2019 Outcome – What it means for you
- STP – COMPULSORY Cloud-based Payroll Reporting
- AI and RPA changing the Future of Work
- SuperStream Deadline for Small Employers
- Superannuation Year End Considerations Continue!
- YML Insight February 2015
- Happy NEW Financial Year – ATO Changes Update
- Economic Stimulus Package Updates – JobKeeper 2.1
- Does your SMSF have an investment strategy?
- Business Process Outsourcing (BPO) – Remote / Offshore
- YML Insight March 2015
- General Outsourcing Services provided by YML
- How to get on top of your finances post COVID-19
- Other Topics
- FAMILY TRUST DEED VARIATION
- ENCOURAGING NEWS FOR Permanent residency (pr) APPLICANTS
- WORK RELATED CAR EXPENSES - WHAT'S LEGAL?
- WHAT IS THE BEST WAY TO PAY OFF YOUR DEBTS?
- Business Protection Insurance
- Aiming to Make a Final Non Concessional Superannuation Contribution for 2016? Be Careful!
- Getting Organized and Planning Effectively This EOFY
- New Withholding for Non Residents
- Four Per Cent Stamp Duty Surcharge for Overseas Investors Buying Residential Real Estate in NSW
- Co-Sourcing: An Alternative To Out-Sourcing
- What Small Business Expenses Can You Claim?
- Israeli Tax of Trusts
- New Superannuation Rules
- YML Group App - Coming Soon
- Obtaining a Business Skills Visa
- Quick Tips to Pay Off Your Mortgage Sooner
- FBT on Christmas Gifts and Tax Deductibility of Christmas Parties
- Changes to the Assets Test for Centrelink Aged Pensions from January 1st 2017
- Why You Should Consider Co-Sourcing for your Business
- Is It Worth Fixing Your Loan?
- Co- Sourcing
- Shareholder's Agreements
2020-21 Federal Budget – UpdateThe Australian Government’s 2020-21 Federal Budget has been designed to increase employment and boost businesses during the ongoing COVID-19 pandemic. Key initiatives in the areas of personal taxation, job creation and infrastructure spearhead an array of economic measures intended to boost production in Australian industry.
In the June quarter this year, the Australian economy contracted by 7%.
Australia’s Treasurer has revealed an expected deficit of $213.7 billion in 2020-21. He announced a deficit fall to $66.9 billion by 2023-24.
Australia’s gross debt will increase to 45% of GDP ($872 billion) this year and then stabilise at around 55% of GDP in the medium term, whilst Australia’s net debt will increase to 36% of GDP ($703 billion) this year and then peak at 44% of GDP in June 2024, declining to less than 40% of GDP in the medium term.
Personal Income Tax Plan
Planned personal income tax cuts have been brought forward by two years and will now apply from 1 July 2020. What this means is…
From 1 July 2020 (subject to legislation being passed), $17.8 billion worth of tax cuts will improve the net income of workers as follows:
|Tax Rate||Current||From 1 July 2020|
|0%||$0 - $18,200||$0 - $18,200|
|19%||$18,201 - $37,000||$18,201 - $45,000|
|32.5%||$37,001 - $90,000||$45,001 - $120,000|
|37%||$90,001 - $180,000||$120,001 - $180,000|
|LITO||Up to $445||Up to $700|
An extension of the LMITO (Low and Middle Income Tax Offset) will mean a tax reduction of up to $1,080 for individuals with a taxable income of up to $126,000 during the 2020-21 financial year.
Economic Support Payments
Eligible recipients will receive two tax-exempt economic support payments of $250 each – one in November 2020 and the second in early 2021. People eligible are those currently receiving and/or holding (*conditions apply):
|Age Pension||Pensioner Concession Card*|
|Disability Support Pension||Commonwealth Seniors’ Health Card|
|Carer Payment||Veterans’ Affairs Payment*|
|Family Tax Benefit*||Veterans’ Affairs Concession Card*|
Capital Gains Tax – Granny Flats
From 1 July 2021 (subject to legislation being passed), a new measure would provide for a targeted CGT exemption for granny flats where a formal written agreement – family/personal, NOT commercial – is created, varied or terminated for older Australians or Australians with disabilities.
First Home Loan Deposit Scheme
For first home buyers purchasing a new home or a newly-built home, an additional 10,000 places will be available under the First Home Loan Deposit Scheme – from 6 October 2020 until 30 June 2021. This means more people purchasing homes for a minimal 5% deposit without mortgage insurance.
A reform to superannuation will see individuals able to use their current superannuation fund whenever they change employment, thus impeding any duplication of funds. Under this reform, a super fund would be ‘stapled’ to an individual.
From 1 July 2021, if an employee does not nominate a super fund account when they start a new job, an employer will pay the super contributions in to the new employee’s existing super fund – by obtaining information about the new employee’s existing super fund from the ATO. How? An employer will log on to ATO online services and enter the new employee’s details to determine the employee’s existing super fund account.
If an employee does not have an existing super fund account and does not decide upon a super fund, then an employer will pay the super contributions in to the default (company-nominated) super fund.
NEW JobMaker Hiring Credit
A new scheme to help increase employees in businesses has been developed. Called JobMaker Hiring Credit, it is available to eligible employers over 12 months from 7 October 2020 for each new position created.
Eligible employers can receive:
- $200 per week if they hire an eligible employee aged 16 to 29 years
- $100 per week if they hire an eligible employee aged 30 to 35 years
- Increase overall employee headcount and payroll;
- Work a minimum of 20 hours per week, averaged over a quarter; and
- Have received JobSeeker Payment, Parenting Payment or Youth Allowance for at least one month out of the three months prior to commencing the job.
To help businesses with less than $5 billion in turnover to invest in their future, this new measure enables them to fully expense new depreciable assets and the cost of improvements to existing eligible assets in the first year of use – acquisition of eligible capital assets from 7:30pm AEDT on 6 October 2020 and first used or installed by 30 June 2021.
Whereas the existing Instant Asset Write-Off is for asset purchases up to $150,000 (for businesses with less than $500 million in turnover and not applicable on purchases after 31 December 2020), this new measure does not cap an asset’s cost.
Carry-back Company Losses
The full expensing of capital asset investment will generate tax losses for some companies. Therefore, the new measure of enabling a company to carry-back losses will generate cash refunds for eligible companies. How does it work?
For eligible companies with less than $5 billion in turnover, losses may be applied against taxed profits in a previous year, thereby generating a refundable tax offset in the year in which a loss is made.
Losses from income years 2019-20, 2020-21 and 2021-22 may be carried-back to offset previously taxed profits in income years 2018-19, 2019-20 and 2020-21.
Eligible companies can receive their tax refunds after lodging tax returns for 2020-21 and 2021-22.
R&D Tax Incentive
As at the release of the Federal Budget, numerous and varied proposed amendments to the R&D Tax Incentive are before Parliament.
Currently, the R&D Tax Incentive provides (for the first $100 million of eligible expenditure):
- 43.5% refundable offset amount for eligible companies with less than $20 million turnover
- 38.5% non-refundable tax offset for all other eligible companies
Government incentive to help businesses sees a range of tax concessions now available to businesses with an aggregated turnover of up to $50 million (previously only available to small and medium businesses).
There are three phases of expanded tax concessions:
|From 1 July 2020||
|From 1 April 2021||
|From 1 July 2021||
Retraining / Reskilling Workers FBT Exemption
From 2 October 2020, employer-provided retraining and reskilling of employees who are redeployed to a different role within a business* will be FBT exempt (*conditions apply).
Corporate Residency Test
The Corporate Residency Test will be changed to clarify the treatment of a company which is incorporated offshore. The change means that a company, incorporated offshore, will be treated as an Australian tax resident if it has a ‘significant economic connection to Australia’, satisfied by both:
- a company’s core commercial activities are undertaken in Australia; and
- a company’s central management and control are in Australia.
In the first FBT year (1 April) after the date on which legislation is passed, employers will be enabled to rely on existing corporate records – as opposed to employee declarations – for FBT purposes.
100,000 New Apprenticeships
From 5 October 2020, a 50% wage subsidy will be available to eligible businesses that take on a new or recommencing Australian apprentice or trainee up until 30 September 2021.
The 50% wage subsidy is capped at a maximum of $7,000 per quarter.
How can YML help?
We hope that this guide helps you to navigate the 2020-21 Federal Budget. Please talk to our Accountants today if you would like to engage YML Chartered Accountants to manage your ‘road to recovery’. Contact us on (02) 8383 4400 or by visiting the Contact Us page on our website.