Federal Budget 2024 -2025
FOREIGN RESIDENT CAPITAL GAINS TAX
The proposed changes by the government from 01 July 2025
– Expansion in the types of assets under the regime.
– Principal asset test to be replaced with 365-day test.
– Transactions on share or other interests exceeding $20 million needs to be reported.
TEMPORARY INCREASE TO THE ASSET WRITE-OFF THRESHOLD FOR SMALL BUSINESSES
Small businesses with an aggregated turnover of less than $10 million will come under the scheme with an instant deduction (i.e. write-off) on newly purchased asset up to the value of $20,000.
Assets are required to be installed and ready to use between 1 July 2024 and 30 June 2025.
SUPERANNUATION ON PARENTAL LEAVE
The government announced payments under the Paid Parental Leave (PPL) scheme will now also include the superannuation guarantee for births and adoptions on or after 1 July 2025.
Eligible parents will receive an additional payment based on the superannuation guarantee (12% of their Paid Parental Leave payments).
STAGE 3 TAX CUTS & MEDICARE LEVY
The government announced revision to the Stage 3 Tax Cuts (previously announced on 25 January 2024) now effective from 01 July 2024.
– 19% tax rate will be reduced to 16%
– 32.5% tax rate will be reduced to 30%
– Threshold of 37% rate will be increased from $120,000 to $135,000
– For 45% tax rate will be increased from $180,000 to $190,000
– Threshold for singles increased from $24,276 to $26,00
– Family threshold increased from $40,939 to $43,846
– Threshold for singles seniors and pensioners increased from $53,406 to $57,198; and
– Family income thresholds increase by $4,027 for each dependent child, from $3,760.
ENERGY PRICE RELIEF
The government announced an investment of $3.5 billion over the preceding 3 years to provide relief from increasing energy prices.
– From July 2024, households will have a $300 rebate applied directly to their electricity accounts.
– Small business classified as a small customer will have a $325 annual rebate applied, administed quarterly.
STUDENT DEBT
The government announced changes for people with Higher Education Loan Program (HELP) and other Australian government student debt. The proposed changes will see indexing to lower of the consumer price index or wage price index. Those who have paid off their debts from 30 June 2023 and now, will have their previous charges amended.
MULTINATIONALS AND HIGHWEALTH INDIVIDUALS
The government announced intentions to expand the current Tax Avoidance Taskforce. This will address critical tax avoidance risks, particularly amongst multinationals, large businesses, and hih net wealth individuals.