Federal Budget 2021-2022

Individuals

The low and middle income tax offset, available to taxpayers earning less than $126,000 per year, will remain for the 2021–22 income year.

Individual tax residency rules to be simplified under new framework.

The current limitation for claiming a self-education expense, where the first $250 of the allowable deduction is denied, will be removed.

CPI indexed Medicare levy low-income threshold amounts for singles, families, and seniors and pensioners for the 2020–21 year announced.

The childcare subsidy will be increased up to a maximum of 95% from 1 July 2022.

Companies and Business

Temporary full expensing of eligible assets will be extended by 12 months to 30 June 2023.

The temporary loss carry back offset will be extended by one year to apply for 2022–23 income year losses.

Extended powers for AAT to pause or modify ATO debt recovery action for small business taxation decisions.

Superannuation guarantee exemption for employees earning less than $450 in a month will be removed.

Taxpayers with certain intangible depreciating assets will be given the choice of using the statutory effective life or self-assessing the decline in value from 1 July 2023.

Superannuation

From 1 July 2022, individuals aged 67 to 74 will no longer be required to meet the work test when making or receiving non-concessional superannuation contributions or salary sacrificed contributions.

From 1 July 2022, the eligibility age to make downsizer contributions into superannuation will be reduced from 65 to 60 years of age.

The maximum amount of contributions that can be released from superannuation under the first home super saver scheme (FHSSS) will be increased from $30,000 to $50,000 from 1 July 2022.

The central management and control safe harbour test for an SMSF to be considered an Australian superannuation fund will be extended from 2 years to 5 years. Also, the active member test will be removed.

The information in this blog is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute advice. While we attempt to ensure the information is current and accurate we do not guarantee its currency and accuracy. You should seek professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.

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