Budget 2019-20: what advisers need to know

With an election looming, the 2019-20 Budget held very few surprises for advisers.  

This was a ballot box budget aimed at bolstering perceptions and consumer sentiment.

What’s missing is direction on the previously announced measures that would deny non-residents access to the CGT main residence exemption. For superannuation advisers, there is very little of interest beyond the streamlining of ECPI calculations and the previously announced work test measures.

Individuals

  • $19.5bn personal income tax cut package
  • Low and middle income tax offset (LMITO) increased
  • Low income tax offset (LITO) increased
  • One-off energy assistance payments
  • Medicare levy thresholds increased
  • Higher Education Loan Program cost recovery program delayed

Superannuation

  • Superannuation ‘work test’ watered down & age limit for spouse contributions increased
  • Permanent tax relief for merging super funds
  • Streamlining the calculation of ECPI
  • Opt-in insurance delay
  • Defence Force members can stay in super fund after discharge

Business           

  • Instant asset write-off increased to $30k and expanded to businesses under $50m
  • Division 7A changes postponed
  • Luxury car tax refunds increased for primary producers and tourism operators
  • North Queensland flood grants to be tax-free
  • Queensland storm payments to be tax-free
  • Increased funding for Export Market Development Scheme

Compliance

  • $1bn ATO ‘sugar hit’ to tackle large corporates and high net wealth individuals
  • Recovering unpaid tax and superannuation liabilities         
  • $607m to follow through on response to Banking Royal Commission           
  • ABN status stripped for non-compliance
  • Support for small business in tax disputes
  • Sham contracting unit established           
  • Registration scheme for Labour Hire operators

International agreements           

  • Australia-Israel Tax Treaty          
  • Australia Hong Kong Free Trade Agreement         
  • Indonesia Australia Comprehensive Economic Partnership Agreement        
  • More countries added to information exchange list           
  • More work and holiday visas for Indonesians        

Other   

  • $3.9bn Disaster response funding
  • Climate solutions package

In-house training is one of the best ways to keep your team up to date and operating at best practice.

Call me on0412 161 190 to discuss your training requirements or email taxbytes@taxbytes.com.au

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