Welcome to Curve’s monthly newsletter, keeping you up to date with our news, views and more.
On May 9, 2023, the Federal Budget was unveiled, revealing several noteworthy changes affecting businesses, taxes, and superannuation.
Please see our Budget summary below and don’t hesitate to get in touch if you have any questions or concerns.
Revival of Small Business Instant Asset Write-Off
For the fiscal year 2022-23, the instant asset write-off will make a comeback. If you purchase an asset for business purposes that costs less than $20,000, you can immediately deduct the business portion of its cost in your tax return. This deduction applies to each asset with a value below $20,000.
Reduction in Quarterly Tax Instalments for GST & Income Tax
Eligible small businesses will experience a halved increase in their quarterly tax instalments for both GST and income tax in 2023-24. This measure aims to alleviate the financial burden on small businesses amid the current economic conditions.
Extension of Tax Return Amendment Period
The amendment period for tax returns will be extended from 2 years to 4 years. This extension allows for a longer timeframe to make necessary corrections or adjustments.
Increased Taxation for Superannuation Balances exceeding $3 Million
Starting from July 1, 2025, earnings on superannuation balances exceeding $3 million will be subject to an increased concessional tax rate of 30%. Balances below $3 million will continue to be taxed at the concessional rate of 15%. This measure targets higher superannuation balances to ensure a fair distribution of taxation burdens.
Shift from Quarterly to Payday Superannuation Payments
Commencing on July 1, 2026, employers will be required to pay their employees’ superannuation at the same time they pay their wages. This change enables employees to conveniently track their entitlements, ensuring they receive their superannuation payments on time and in full.
Consolidation of Paid Parental Leave
Effective from July 1 of this year, the Parental Leave Pay and Dad and Partner Pay programs will be combined into a single 20-week payment. The duration of this payment is set to increase to 26 weeks by 2026. The income test threshold for families will be $350,000 per annum.
Small Business Energy Incentive
The Small Business Energy Incentive offers a 20% bonus deduction to small businesses with annual turnover under $50 million. It applies to spending on assets that promote energy efficiency and electrification. The maximum deduction is $20,000 per business, with a total expenditure limit of $100,000. Eligible assets must be used or installed between July 2023 and June 2024.
Increase in Medicare Levy Low-Income Threshold
Starting from July 1, 2022, the Government will raise the Medicare levy low-income thresholds for singles, families, seniors, and pensioners. This increase in thresholds aims to provide cost-of-living relief.
Please don’t hesitate to get in touch if you would like to discuss any of the budget changes or have any queries or concerns.
