Wednesday 16 September 2020

Your 2020 Federal Government Budget Highlights

It is all about jobs, about empowering people, is the mantra of the Federal Government’s 2020 Budget. One notable point is that the Government does not look to be extending JobKeeper (expiring 31 March 2020) or JobSeeker (expiring 31 December 2020).  Below are the highlights from the budget:

Individuals

• Low and middle income earners will receive tax relief up to $2,475 for singles and $5490 for dual income families in 2020/2021

• Tax cuts for workers from 1 July (backdated)

• low income tax offset increase from $445 to $700

• top threshold of 19% bracket increased from $37,000 to $45,000

• top threshold of  32.5% bracket increased from $90,000 to $120,000

• First Home Loan Deposit Scheme (FHLDS) to be expanded allowing eligible applicants to purchase a home with a deposit of 5% without paying lenders mortgage insurance

• A one off Low and Middle Income Tax Offset payment of up to $1,080 for individuals and $2,160 for dual income families.

• Employees will keep their super fund when they change jobs and a new online YourSuper comparison tool will be launched to help people decide where to put their super funds

• Capital gains tax will be scrapped for granny flats

Business

 

• Businesses with a turnover of up to $5b will be able to immediately deduct the full cost of eligible depreciable assets from 6 October 2020, with no tax write off value limit

• Companies with a turnover of up to $5b will be able to offset losses against previous profits on which tax has been paid. Losses incurred to June 2022 can be offset against prior profits made in or after the 2018/2019 financial year

• The Government has increased the aggregated annual turnover threshold for small business access to 10 small business tax concessions from $10m to $50m over 3 phases, first starting 1 July 2020

• Businesses will be exempt from fringe benefits tax if they retrain and redeploy workers facing redundancy

• From 7 October 2020 eligible employers who create a new role within their business will be able to claim a wage subsidy of $200 per week if you hire a 16-29 year old, 4100 per week for a 30-35 year old for up to 12 months

• Employers will get $1.2b in subsidies for 100,000 new apprentice wages each year

• $1.56b in grants will be issued to encourage advanced manufacturing in resources and critical minerals, food and beverages, medical products, recycling and clean energy and defence and space

• $10b in ‘use it or lose it’ payments will be doled out to the states to get infrastructure projects moving