2020-21 Federal Budget Wrap-Up

TL;DR

The Australian government has announced tax cuts and stimulus measures to boost the economy and provide relief to individuals and small businesses.

Transcript

g'day and welcome to this week's video my name is robert gowdy from consortium private wealth and we're going to go through just a quick budget uh wrap was on a couple of nights ago so we thought we'd just go through some of the the key points we're not going to go through it in a really high level detail um but yeah definitely the the tax uh cuts ... Read More

Key Insights

• 💇 Tax cuts and stimulus measures aim to provide relief and boost the economy.
• 👨‍💼 Small businesses will benefit from tax deductions for asset acquisitions.
• 🛄 Changes to superannuation aim to improve transparency and performance.
• 🔒 Social security payments will increase with additional support payments.
• 🌍 Infrastructure investments will be made to boost national transport.

Questions & Answers

Q: What are the proposed changes to income thresholds?

The existing tax thresholds will be adjusted, with the range of taxable income from $18,000 to $37,000 now taxed at 19% plus Medicare. The $37,001 to $90,000 range will be taxed at a rate of 32.5% (excluding Medicare).

Q: How will the tax cuts benefit individuals?

The tax cuts will result in significant savings for individuals earning up to $120,000. For example, someone earning $60,000 can expect to have nearly $2,200 more in their pocket each year.

Q: What are the incentives for small businesses?

Small businesses with a turnover of less than $5 billion can claim a full tax deduction for assets acquired and used by June 30, 2022. Second-hand depreciating assets can also be included if the turnover is below $50 million.

Q: What changes are being made to superannuation?

Employers will be required to pay superannuation contributions to an employee's existing fund, rather than setting up a new fund. A new comparison tool will provide transparency on fees and investment returns, and there will be an annual performance test for superannuation funds starting from July 2020.

Summary & Key Takeaways

• The government has brought forward tax cuts, with changes to income thresholds that will result in savings and extra money for individuals.

• There are adjustments to low income tax offsets, providing more value for those earning below $37,500.

• The low and middle-income tax offset will end this financial year, offering savings for individuals earning under $126,000.