Insights – The Federal Budget 2022-2023 Round 2
With only 7 months before the 2023 budget, the budget has been described as a sensible budget.
A summary of some of the relevant announcements.
The changes for business were centered around environment
Energy Efficient Grants
The government will provide $6.2 million over 3 years to help business fund energy efficient equipment upgrades to reduce remission
Removal of FBT on EV’s
There will be no FBT or import tariffs on Electric vehicles that are under the luxury car tax threshold.
Tax Free Covid grants
Some additional COVID grants will now be non assessable income, mostly those received by businesses in Victoria.
Child Care Subsidy
For families earning less than $530,000 there will be an increase in the Child Care Subsidy rebate. At the lower level, families earning less than $80,000 will increase from 85% to 90%.
Paid Parental Leave
Starting 1 July 2023 PPL will become more flexible allowing either birth or non birth parents to claim the payment if they meet eligibility criteria and parents will be able to take leave at the same time.
From 1 July 2024- the current scheme will extend from 18 weeks by two weeks a year until it reaches a full 26 weeks in 2026.
Both parents will be able to share the entitlement, with sole parents being able to access the full 26 week entitlement.
Aged Pensioners back to work
Aged pensioners and veterans will be able to earn an additonal $4,000 per year before their pension is reduced, allowing those who want to, to return to work. This can accumulate over the year so that work performed on an ad hoc basis is not disadvantaged.
Seniors Health Care Card
The income test limits have been reduced meaning singles can be eligible while earning up to $90,000 and couples up to $144,000.
Income Support Assets Test extended for sail of main residence
Where the main residence has been sold there will be an exemption for this amount in determining eligibility under the assets test for up to 24 months and lowering the deeming rate for these proceeds in calculating the income test.
Downsizer eligibility changes
An individual will now be able to make a non taxable “downsizer contribution’ to their fund of up to $3000,000 per person when selling their home once they turn 55.
The ATO will spend more money on compliance for individuals overclaiming deductions and underreporting income, particularly those in the cash economy.
How Can Alto Help?
If you are unsure of how the budget measures may apply to you, please reach out to discuss in more detail with one of the Alto team.
Author: Donna Bruce