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This year’s budget focused on small business, jobs and families with the goals of restoring confidence in the economy. Below is a breakdown and brief explanation of the key announcements and what they mean for you, your business and your family…..

Changes for small business

The Small Business Package has been introduced and the following changes will commence on July 1st of this year

  • Small companies will have their tax rate lowered by 1.5% if their turnover is less than $2m per annum
  • Unincorporated businesses will receive a tax discount of 5% – up to $1000 per annum
  • From 7.30pm May 12th until June 30th 2017 small business can claim an immediate tax deduction (depreciation) for ANY item purchased up to $20,000 (previously $1000)
  • Small Business will now be exempt from Capital Gains Tax if the company benefits from changing its business structure
  • The three year holding period on employee share allocations can now be waived by the commissioner of Taxation if there are circumstances out of the employees control that require them to sell their shares
  • Now ALL business related portable electronics are fringe benefits tax free instead of just one
  • A more streamlined business registration process which should make it easier to start a new business
  • Immediate claim on set up costs including legal and accounting services for new business

Changes for families

  • Access to government funded paid parental leave will be limited to those who do not receive paid parental leave from their employer. If the employers entitlements are less than the government scheme the government will top it up to be the same
  • New Child Care Subsidy – this will replace the current Child Care Benefit, The Child Care Rebate and The Jobs, Education & Training Child Care Fee Assistance
  • Children must meet immunisation requirement to be eligible for the child care subsidy
  • An 85% subsidy of child care fees for families earning under $65,000
  • Subsidies will be paid directly to child care facilities
  • Families earning over $185,000 will have an annual cap of $10,000 on the amount of assistance per child per year
  • A 2 year nanny trial will commence January 1st This will provide a subsidy to eligible families designed to help shift workers and similar with child care expenses
  • Extra assistance for families experiencing hardship and ‘vulnerable children’

Changes for pensioners

  • For single home owners the value of assets you can have in addition to your home will increase from $202,000 – $250,000 to qualify for the full pension
  • Couples who have additional assets less than $451,500 and own their own home will get a higher pension
  • For couples that are home owners the value of assets you can have will increase from $286,500 to $375,000 to qualify for the full pension
  • People who enter and aged care facility will have any rental income gained from renting their former home included in their means test
  • All pensioners that are negatively affected by the scaling back of the maximum assets threshold will be guaranteed eligibility for the Commonwealth Seniors Health Card (CSHC) which provides amongst other things concessions on prescription medicines

Changes for youth

  • There will be a 4 week waiting period for under 25 year olds to receive any unemployment benefits, this is in place of the proposed government measure to make young unemployed people wait 6 months
  • Improvement to the national work experience program
  • Funding in high youth unemployment areas for a youth transition to work program

Other Changes

  • Plans to amend regulations to allow terminally ill people to access their super 12 months earlier than is currently set
  • National Security will get $1.2b in funding
  • ‘Netflix Tax’ a 10% GST on internet downloads to attempt to gain more tax from multinational companies proving downloadable music, movies and books