2015-16 Budget, get the low down.
As most of you are aware the words on every accountant’s lips recently was “Budget Night”.
Whilst we know that for most people this isn’t the highlight of their calendar year as it is for ours, we felt that there may be a few changes that you should be aware of.
The focus of the 2015-16 budget is growth in small business, and families with incentives for the second income earner. The budget has also handed of a win for primary producers with tax breaks for farmers and additional funding in loan schemes.
Small Business Changes
- An immediate deduction for assets under $20,000 will be allowed until 30 June 2017.
- From the 1 July 2015, the government will allow business to claim an immediate write-off for a range of professional expenses such as professional, legal & accounting advice associated with starting a new business
- The tax rate for companies with a turnover of less than $2 million will be reduced by 1.5 per cent from the 2015/16 income year.
- A 5 percent tax discount will apply to individuals and trusts with business income with a turnover of less than $2 million and will also be introduced in the 2015/16 year. This will be capped at $1000 per individual for each income year.
- Small business will be able to change their legal structure without attracting Capital Gains Tax.
- Individuals being paid an employer provided parental leave entitlement will no longer be able to access the existing Government paid Parental Leave Pay scheme, from 1 July 2016.
- Families will not be eligible for subsidised child care or the ‘Family Tax Benefit Part A end of year supplement’ if their child’s immunisations are not up to date.
- From 1 July 2015, the zone tax offset will exclude “fly-in fly-out” workers, where their normal residence is not within a ‘zone’.
- The Medicare levy low income thresholds for singles, families and single seniors and pensioners will be increased from the 2014/15 income year.
- The method of calculating work related car expense deductions will be changed for the 2015/16 income year. The “12% of original value” and the “One third of actual expenses” will be removed. The “cents per kilometer method” will be streamlined by replacing the three current rates to one rate set at 66c per kilometer.
- Early access to superannuation will be provided to people with a terminal medical condition with effect from 1 July 2015. Currently superannuation can only be accessed where a terminal person is likely to die within one year, this has now been intended to two years.
- From the 1 July 2016 Primary Producers will be able to claim immediate deduction for water facilities and fencing, and fodder storage assets will be able to be depreciated over three years.
- The government will invest a further $250 million to continue the Drought Concessional Loan Scheme and Drought Recovery Concessional Loan Scheme for an additional year. Another $45 million will be provided from 2015-16 to assist farmers to reduce the impact of pest animals in affected areas.