Individuals
Personal Income Tax Cut
Stage 2 of the personal Income Tax Plan – Tax Cut apply from 1 July 2021 as follows:
- The upper threshold of the 19% personal income tax bracket was raised from $37,000 t0 $45,000
- The upper threshold of the 32.5% personal income tax bracket was raised from $90,000 to $120,000
Businesses
Increase in Superannuation Guarantee
From 1 July 2021, employers are required to contribute 10% of an employee’s salary under superannuation guarantee scheme. This is an increase from the 9.5% rate.
Majority of payroll system should have these changes in place. However, we encourage businesses to check to ensure that the payroll system is correctly calculating the superannuation under the new rate for payroll post 1 July 2021.
Increase in Minimum Wage
The Fair Work Commission has announced increase in the minimum wage of 2.5%. This increment applies to all award wage effective from 1 July 2021. However, for Covid impacted industries such as retail, hospitality, tourism, registered club etc, these increases are deferred to 1 September 2021 or 1 November 2021.
Instant Asset Write Off
The instant asset write off for the business portion of eligible assets has been extended for the 2022 financial year. The eligibility and extent of the write off depends on a number of factors such as business turnover, value of the asset.
Companies
Changes in Company Tax Rate
From 1 July 2021, the company tax rate for companies with aggregated turnover of less than $50 million reduced to 25% from 26% in the 2021 year.
Loss carry back tax offset
Eligible companies can carry back loss as far as 2019 for a refundable tax offset.