10 May 2018 Budget Highlights
The Federal Treasurer, the Hon. Scott Morrison MP, delivered his third Federal Budget on the 8th of May 2018. Like many Australians, we tuned in to find out how the announcement would impact our clients. The Government is pitching a plan to deliver tax relief to lower and middle-income Australians, which it says will benefit more than 10 million people. We understand that there is a lot of information out there about the new budget so to help you with this, we have put together a brief summary of what to expect along with some links to ‘easy to understand’ articles and resources from well known sources.
2018 Budget Highlights
Personal income tax
- Income tax cuts through a combination of tax rate threshold changes and tax offsets.
- Tax deductions denied for expenses associated with holding vacant land.
- Minor beneficiaries will be taxed under general minor tax rates, not adult tax rates, on income from certain assets in a testamentary trust.
- Cash payments to businesses will be restricted to $10,000 or less.
- Self-managed superannuation fund (SMSF) member limit increase.
- SMSF three-yearly audit cycle.
- Work test exemption for those with balances of less than $300,000.
- Individuals with multiple employers able to opt out of Superannuation Guarantee.
- Opt-in basis for default insurance inside superannuation.
- Passive fees, exit fees and inactive super.
- Requiring superannuation fund trustees to offer Comprehensive Income Products for Retirement (CIPRs).
- Expansion of the Pension Loan Scheme.
- Extension of the Pension Work Bonus.
- New means testing rules for lifetime retirement income products.
- Improving access to residential and home care.