2017 Federal Budget

30 May 2017

On Tuesday 9 May 2017, Treasurer Scott Morrison handed down his second Federal Budget. We have summarised a selection of the announcements, however for more detailed information or advice on how this budget may affect your specific circumstances, please contact us.

Housing Affordability

  • For owners of rental properties, any deductions for travel expenses incurred maintaining, inspecting or collecting rent on a residential rental property will be denied from 1 July 2017.
  •  From 1 July 2017, individuals will be able to make voluntary superannuation contributions up to $15,000 per year (up to $30,000 in total), which can then be withdrawn to be used for a first home deposit. Withdrawals can begin from 1 July 2018 and couples can both use the scheme and combine their contributions for a single deposit. The contributions will be taxed at 15% in the superannuation fund. Withdrawals will be taxed at the individual’s marginal tax rate less a 30% tax offset.
  •  The Capital Gains Tax discount for Australian resident individuals investing in qualifying affordable housing will be increased from 50% to 60% from 1 January 2018.
  • From 1 July 2018, individuals aged 65 or over will be able to contribute into their superannuation fund up to $300,000 from the proceeds of the sale of their home as a non-concessional contribution.

Small Businesses

  • The $20,000 instant asset write-off for small businesses (businesses with an aggregated annual turnover of less than $10 million) will be extended to 30 June 2018

Individuals

  • Revised repayment thresholds and rates for Higher Education Loan Program (HELP) debts will be introduced from 1 July 2018.
  • The Medicare Levy will be increased from 2.0% to 2.5% of taxable income from 1 July 2019.
  • The Medicare Levy low-income thresholds for singles, families and seniors and pensioners will increase from 1 July 2017.

For further information on these or any other budget announcements please contact us.