After 2020’s “Pandemic Budget”, this year’s Budget focused on maintaining and growing economic recovery. To save you time, we’ve focused on a handful of key proposals likely to affect you – including increased flexibility around super. As always with Budget announcements, these measures are subject to legislation, and expected to commence from July 1, 2022.
The announced proposal will see part-time workers benefit from the removal of the $450 per month minimum income threshold, with all employees to be paid the superannuation guarantee by their employer.
The announcement of the change to the First Home Super Saver Scheme (FHSSS) will help to reduce pressure on first time home buyers. If the proposal is approved, the maximum releasable amount of voluntary concessional and non-concessional contributions will be increased from $30,000 to $50,000.
In more welcome news on the flexibility around superannuation, from 1 July 2022, the age for eligibility for the downsizer scheme will be lowered from 65 to 60. The proposal will see members aged 60+ who meet all eligibility requirements, able to contribute up to $300,000 to their super following the sale of their home, whilst couples can contribute $300,000 each.
Retirees will benefit from the abolishment of the work test on 1 July 2022, meaning retirees aged between 67 and 74 can add to their super without having to satisfy any test.
Tax payers, for another year, will benefit from tax relief aimed at driving the economic recovery as part of the second stage of the Personal Income Tax Plan. The Government announced it will extend the low and middle income tax offset (LMITO) to the 2021-22 financial year.
A tax rate reduction from 30% to 25% will be introduced from 1 July 2021 for small and medium businesses. Temporary full expensing has also be extended to 30 June 2023 allowing the full value of any eligible depreciable asset up to $150,000 to be written off in the first year of installation.
The Budget included an announcement of $506 million to be spent on providing 163,000 training places in industries of critical importance over two years.
Please note that remember these announcements are proposals only and are yet to be passed by Parliament.