Well well well. It was one of the bigger nights of the year (in a financial sense...) on Tuesday night when Jim Chalmers stepped up to the pulpit and delivered his 2024-25 budget.
So, what the heck was in it and what might be of interest? Here’s a little summary of the bigger stuff for our small business friends. Of course, you can jump in and find the full budget HERE if you want to go through it in depth!
Tax Cuts For ALL!
Yep. As legislated a few years back under the former government and tweaked by Jimbo a few months back, the tax cuts were confirmed - “tax cuts for everyone”.
There’s some new tax rates and thresholds on the cards for 2024-25 as well:
This means there will be a few tax savings on the horizon as the thresholds change a little with the 32.5% bracket now a flat 30% and the 19% bracket now sitting at 16%, so here’s what the estimated savings may look like (estimates of course!)
- $18,201-$45,000 = tax savings of up to $804
- $45,000-$135,000 = tax savings between $804 and $3,729
- $135,000-$190,000 = tax savings between $3,729 and $4,529
- $190,000 and more = tax saving of $4,529
Of note also, the rate of super guarantee charge (SGC) goes up from 11.0% to 11.5%.
Instant Asset Write Offs Extended
The Government has extended the $20,000 instant asset write off for small businesses with turnovers of less than $10 million another year, into the 2025 financial year. This was meant to find its way into the bin this year, but alas, it’s been revived again. So, if some of your capital investments sit in that realm, hello, you can qualify for the instant asset write off.
Slight disclaimer here - this measure, first announced in last year's budget, is yet to be legislated; it’s stuck somewhere with pollies arguing that it should be $30,000.
HECS/HELP Debt
Instead of another rise, students will now get an indexation credit as a part of the government's $3 billion dollar “wipe” of student debt. Really, there’s no wiping going on, it’s just a credit that relates to your HECS balance, but nevertheless It’s a welcomed call. The indexation has been capped and it’s been backdated to 1 June 2023 as well, which after last year, will be another welcome sight for students with HECS debts!
Energy bill relief
There’s a couple of things here to note for both households and small businesses. Firstly, households.
From July 1, 2024, all households will receive a total rebate of $300 which will be automatically put onto your electricity bills in quarterly statements.
Small businesses don’t miss out either. Obviously, you must be eligible, but the Energy Bill Relief Fund is providing rebates to around 1 million of them. This rebate sits at $325!
Other interesting points!
The ATO has also been giving more funding to help build a more robust system that better helps them prevent the old tax fraud from happening and helps keep the taxpayer sturdy and solid to the date lodgements are due.
Super is on the agenda again. The government announced that they will pay superannuation on Commonwealth funded paid parental leave. This would kick in on 1 July 2025 if passed.
Be ready for ATO audit activity – as part of this budget, the government has invested a “considerable” amount into the ATO to further fund and expand their audit activities and taskforce. (Talk to us if you're keen to chat some audit cover, we have some friends who can help out here!)
A Future Made in Australia – a “yet to be detailed” package aimed at creating new jobs and opportunities by maximising the benefits of Australia’s move to net zero (not Xero) carbon emissions.
So there it is, of course if you want to chat through things more in depth or find out more about the budget, reach out to us!
