Wednesday, June 27, 2012

What'll change from July 1? (apart from the carbon tax)

Me on ABC Adelaide 891 June 20, 2012

14 minutes, play or CLICK, THEN CLICK AGAIN to download mp3

What we know, from July 1:


HIGHER INCOME TAX-FREE THRESHOLD Earnings of up to $18,200 tax-free (previously $6000)

INCOME TAX CUTS Every worker earning up to $80,000 will pay less tax.
Current scale Starting July
From $6001 15% From $18,201 19%
From $37,001 30% From $37,001 32.5%
From $80,001 37% From $80,001 37%
From $180,001 45% From $180,001 45%

LOW INCOME SUPER TAX RELIEF: A payment of up to $500 a year will effectively mean no tax is paid on compulsory super contributions for workers earning up to $37,000 a year.

SCHOOLKIDS BONUS Worth $410 per annum for each primary school student and $820 for each secondary school student for families on Family Tax Benefit A. To be paid each January and July from January 2013. An early full-year payment was made this month.

EXTRA FAMILY TAX BENEFIT Families receiving the maximum rate of Family Tax Benefit Part A with two or more children will receive an extra $300 a year if they have one child, $600 a year for two or more children. Families receiving the base rate will get $100 a year if they have one child, $200 if they have two or more children.

LUMP SUM SUPPLEMENTARY ALLOWANCE $210 a year for singles or $350 a year for couples receiving benefits such as Newstart, Youth Allowance, Austudy and Parenting Payment.

CLEAN ENERGY SUPPLEMENT equal to a 1.7 per cent increase in pensions, allowances and family payments, worth up to $338 per year for single pensioners and self-funded retirees, up to $510 per year for pensioner and self-funded retiree couples, up to $110 per child for a family that receives Family Tax Benefit Part A. Paid fortnightly from March or July 2013. Advance payments were made in May and June.

LOW INCOME SUPPLEMENT $300 per year for low income households who do not receive sufficient levels of assistance through tax cuts or other carbon compensation payments

ESSENTIAL MEDICAL EQUIPMENT PAYMENT $140 per year to people who experience additional energy costs from the use of essential medical equipment

FLOOD LEVY The flood levy used to help rebuild flood-affected areas in Queensland – paid by people earning more than $50,000 - will no longer apply...


EXTRA SUPER TAX FOR HIGH INCOME EARNERS Australians earning more than $300,000 will pay 30% tax on super contributions (up from 15%)

LOWER CAP ON EXCESS SUPER CONTRIBUTIONS For most people the cap will fall from $50,000 to $25,000. Extra contributions of more than $25,000 will be taxed at 31.5 per cent in addition to the 15 per cent superannuation contribution tax.

MEANS-TESTED PRIVATE HEALTH INSURANCE REBATE Individuals earning more than $84,000 and families earning more than $168,000 will have their rebates cut 10 percentage points. (For instance those under 65 will get a rebate of 20% instead of a 30% rebate.) Individuals earning more than $97,000 and families earning more than $194,000 will have their rebates cut 20 percentage points. Individuals earning more than $130,000 and families earning more than $260,000 will get no rebate.

MEDICARE LEVY SURCHARGE Currently 1% for individuals earning more than $84,000 and families earning more than $168,000 who do not take out private health insurance, the surcharge will climb to 1.25% for individual incomes of $97,001 to $130,000 and family incomes of $194,001 to $260,000. It will climb to 1.5% for individual incomes above $130,000 and family incomes above $260,000.

NET MEDICAL EXPENSES TAX OFFSET INCOME TEST Individuals earning more than $84,000 and families earning more than $168,000 will have to spend $5000 on out-of-pocket medical expenses before they are eligible to claim the offset ($2,120 next year) and will only be able to claim 10% of what is spent (normally 20%).

GOLDEN HANDSHAKES FOR EXECUTIVES Tax breaks will only apply to first $180,000 of the departure payment


LOSS CARRY-BACK: Companies will be able to uses losses of up to $1 million to get a refund of tax previously paid.

INSTANT ASSET WRITE-OFF: Small businesses will be able to immediately write off eligible assets costing less than $6500

ACCELERATED DEPRECIATION: Small businesses will be able to claim up to $5000 as an immediate deduction for motor vehicles purchased from 2012-13


CARBON TAX – Almost 300 heavy carbon emitters to pay $23 a tonne for every tonne of carbon they release.

MINERALS RESOURCES RENT TAX – Iron ore and coal miners to pay 30 per cent mining tax.

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