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Budget Changes 2018 and how they will impact you!

May, 2018

With the recent budget being released, we tell you how you and your family will be impacted by such proposed changes, and what to plan for at an individual level. It will be great to see some reductions in the individual tax bracket and important superannuation changes. If you require specific advice or tax planning prior to 30th June 2018, please contact our office at emma@grimaaccounting.com.au.

Remember, our practice is not just a tax agent but a registered CPA Firm that maintains high professionalism and integrity.

Budget Highlights May 2018 (proposed but not legislated)


  • New Low and Middle Income Tax Offset, from 1/7/2018 of up to $530 non-refundable offset for taxpayers earning less then $90,000
  • Changes to personal tax rates from 1/7/2018, the 32.5% threshold will increase from $87K to $90K, from 1/7/2022 further increase to threshold for 32.5% from $90K to $120K and extend 19% bracket from $37K to $41K and from 1/7/2014 the 32.5% will extend to $200K and there will be removal of 37% bracket entirely.
  • Small increases to Medicare low income thresholds
  • Denying deductions for costs associated with holding vacant land
  • No increase to Medicare Levy from 1/7/2019 and will remain at 2%
  • Extending compliance activities targeting individual taxpayers and tax agents and income matching programs from 1/7/2018


  • From 1st July, 2019 Annual Audit of SMSF will be reduced to 3 yearly
  • From 1st July, 2019 increase members of SMSF from the allowable 4 to 6.
  • From 1st July, 2019 work test exemption for people aged 65 – 74 with super balances below $300,000.
  • From 1st July, 2018 employees with multiple employers and earning over $263,157 who will be able to unintentionally avoid the breaching of $25,000 concessional contributions cap
  • Capping of passive fees from 1st July, 2019 to 3% on balances less than $6,000 and banning of exit fees on all super fund accounts.
  • Changes to insurance from 1st July, 2019 will be an opt in basis for members with less than $6,000 , members under 25 and members whose accounts have not received a contribution in 13 months and inactive

Prior year Budget Changes implemented


  • Employees to claim personal super contributions – From 1st July 2017 if you don’t have ability to sacrifice superannuation with your employer, you will now be able to do it from post-tax dollars so set up a monthly contribution to assist with this.

Rental Property Investors

  1. From 1st July 2017, you will no longer be able to claim travel expenses incurred to inspect, perform repairs, collect rent etc on rental property. So those who like to travel to inspect their investment property interstate you will no longer be able to claim this expense.
  2. From 9th May 2017, if you purchase investment property after this date, you will no longer be able to claim depreciation on pre-existing plant & equipment assets eg dishwasher, curtains, flooring etc. However, building depreciation will still be claimable.

If you pay for the equipment yourself then yes you can still claim it.

Those who own rental properties prior to 9th May 2017 will not be affected by this change.

Higher Education Loan Program (HELP)

  • Revision of income thresholds for repayment of HELP debt from 1st July 2018. New minimum threshold of $42,000 with 1% repayment and maximum threshold with 10 % repayment.

Seniors Selling your Main Residence

Individuals aged 65 or over and have owned their house for at least 10 years, can make a non-concessional contribution (NCC) up to $300,000 from the proceeds of the sale of their home and exempt from existing age test, work test and $1.6 million balance test

This is to encourage older people to downsize their larger homes for younger, growing families.

Tip: If you’re considering selling your house next year you may want to hold off until after 1 July 2018 to take advantage of this measure.

 End of financial year planning tips 2018

  • Ensure superannuation is paid and received by your fund for all employees by 30th June 2018
  • Review assets list for 2018 Depreciation Schedule for any scrap/obsolete items
  • Make sure you have a diary for working from home for internet/phone usage for 4 weeks of the year to verify claim
  • Make sure logbooks are up to date for company/work related vehicles
  • If a low income earner, ensure pay up to $1,000 prior to 30th June to receive government co-contribution of up to $500.

This newsletter is for general information only. The articles should not be relied upon without professional advice. Contact my office for further information. Liability limited by a scheme approved under Professional Standards Legislation

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