Tag Archive for: Personal taxes

Keeping a vehicle log book

When claiming work-related car expenses, many people miss maximising their claim due to poor record keeping. If you are audited by the Australian Tax Office (ATO), inadequate records could cost you dearly.

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What the revised Stage 3 tax cuts mean for you

After much debate, legislation to scale back “Stage 3 tax cuts” is now law. This legislation passed parliament on 27 February 2024 and received assent on 5 March 2024. Consequently, you may now be wondering what the revised Stage 3 tax cuts mean for you.

Earlier this year, the Albanese government announced it would scale back the previously legislated Stage 3 tax cuts. The result is that the benefit received by those in the highest income brackets will be halved. Lower and middle- income earners will receive more of the benefit than originally legislated.

The Albanese government had previously stated it was fully committed to the passage of the Stage 3 tax cuts as previously legislated. This scale-back is therefore a major backflip.

New legislated Stage 3 tax cuts

The revised individual resident tax rates that will now apply, from 1 July 2024 onwards, will be:

Income bracket: 2024-25 onwards ($)tax rate: 2024-25 onwards (%)
0 – 18,0000
18,001 – 45,00016
45,001 – 135,00030
135,001 – 190,00037
190,001 +45

The key changes from the current (2023-2024) income tax rates are:

  • a reduction from the 19% tax rate to 16% for incomes between $18,200 and $45,000
  • a reduction of the 32.5% tax rate to 30% for incomes between $45,000 and a higher $135,000 threshold
  • an increase to the threshold at which the 37% tax rate applies from $120,000 to $135,000.
  • an increase in the threshold at which the 45% tax rate applies from $180,000 to $190,000.

From 1 July 2024 onwards:

  • a person earning over $200,000 p.a. will pay $4,529 less tax annually
  • a person earning $100,000 p.a. will pay $2,179 less tax annually
  • a person earning $50,000 p.a. will pay $929 less tax annually

Lower and middle- income Australian earners will no doubt welcome the increased benefits they will receive under the revised Stage 3 tax cuts. However, some of the highest-income earners will be disappointed that they will not receive the full benefits they may have anticipated from the Stage 3 tax cut as originally enacted.

Although the tax cuts are less than expected for some, this is still a great planning opportunity. And it is important to start planning now for year end.

To discuss how the revised Stage 3 tax cuts may impact you, and what you can consider regarding your taxable income for the next financial year, contact your Synectic adviser.

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Super balances above $3 million to be taxed at 30% – what does it mean?

The Albanese government have announced plans which will see the earnings on super balances above $3 million taxed at a concessional rate of 30 per cent, from 1 July 2025 onwards. The current rate on these earnings is 15 per cent.

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FBT exemption for electric vehicles in Australia

Fringe Benefits Tax (FBT) exemption for electric vehicles in Australia has now been legislated. The relevant legislation, Treasury Laws Amendment (Electric Car Discount) Bill 2022, received Royal Assent on 12 December 2022. It upholds the Government’s pre-election commitment and broader decarbonisation initiatives.

Of all the employee ‘perks’, employer-provided cars (through novated car leases or private use of company vehicles) are one of the most popular fringe benefits in Australia. As a result, FBT exemption for electronic vehicles has been keenly anticipated.

What do employers and employees need to consider?

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What is Adjusted Taxable Income and why do you need to know?

If you apply for certain tax offsets, concessions or government benefits, you may be asked to provide your “adjusted taxable income” (ATI).

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Personal superannuation changes you need to know about

Let’s talk about superannuation – it’s one of our favourite topics!

Okay, you might not get as excited about superannuation as we do. But there are a number of recent changes to the tax treatment of super that we think you should be aware of.

To help you get the most out of your retirement savings and avoid any unexpected pitfalls, we’ve outlined some of the major developments here.

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Tax and the sharing economy

There are more and more sharing economy, or collaborative consumption, websites and apps hitting the market in Australia and they are making their way from the big cities into the Tasmanian market. With the holiday season upon us, short-term vacation rentals through apps like Airbnb and Stayz will be in full swing. And now that Uber has arrived in Hobart – just in time for the silly season – Tasmanians and our tourists are embracing the ride-sourcing phenomenon.

But before you decide to rent your house out for summer with Airbnb or earn some extra money driving for Uber, you need to consider the tax implications – you may need to pay GST and income tax on your earnings and you may be liable for CGT down the track.

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Work-related travel expenses: Why are they on the ATO’s radar?

Many people, as employees, get their tax returns wrong in relation to claiming work-related travel expenses.

The absence of hard and fast rules can makes claiming travel expenses difficult. Often the deductibility of such costs can depend on the nature of employment, the amount of time spent away from home, and whether an allowance has been received to cover the costs.

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Rental properties: claiming for “repairs” or “improvements”

The ATO is focusing on claims that investment property owners make for repairs to rental residences that it deems to in fact be “improvements”.

The scenario where investment properties have work done on them often happens shortly after the property is purchased, and has led to the term “initial repair” being commonly used when discussing the tax implications of such property works.

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No more zone tax offset for FIFOs

In the 2015-16 federal budget, the government announced that it will exclude “fly-in-fly-out” and “drive-in-drive-out” workers from claiming the zone tax offset (ZTO) where their normal residence is not within a “zone” (access the Australian zone list here).

The measure was not passed by Parliament until late in 2015, but it is now law, effective from July 1, 2015. Anyone who may have looked at making a claim under the ZTO next tax time may need to review their eligibility. Contact us if you would like assistance.

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