Question:
Low income earners super tax offset: Conditional on Minerals Tax
Answer:
Recent changes are outlined below:
July 1, 2022
- Loss carry back for eligible companies extended to cover 2023 income year.
- Professional firm profits diverted to the professional's spouse or other associates to be reviewed under new Tax Office guidance.
- Corporate collective investment vehicle legislative regime introduced.
- Temporary full expensing of depreciating assets extended to include 2023 income year.
- Depreciable assets of a company joining a tax consolidation group have tax costs setting rules modified for assets depreciated under temporary full expensing rules.
December 9, 2021
- Reduced Pandemic leave disaster payment of $750 per week made available through to 30 June 2022.
August 5, 2021
- COVID-19 Disaster Payments are non-assessable non-exempt income in 2021 income year and later. Payments phasing out as vaccination rates increase.
July 1, 2021
- New Investment Engagement Service launched for businesses planning significant new investments in Australia.
- Tax Office small business independent review service made permanent for businesses with turnover < $10m, for income tax, GST, exercise, luxury car tax, wine equalisation tax and fuel tax credits. Requested before amended assessment issued.
- Small business income tax offset for individuals increased to provide a reduction of 16% for a tax payable up to $1,000.
- Self-managed superannuation funds can now have six members, increased from four members previously.
July 1, 2021
- Some COVID -19 state and territory business grants received by small and medium enterprises are non-assessable, non-exempt income for 2021 and 2022 income years.
- Certain state, territory and local government financial support for individuals and businesses suffering COVID-19 impacts made exempt where businesses have turnover less than $50 million and only in eligible programs.
March 31, 2021
- JobKeeper payments scheme ended.
October 5, 2020
- Boosting apprenticeship commencements subsidy (up to 50% of apprentice's wages) is assessable income.
June 4, 2020
- Homebuilder grant for new home or substantial renovation construction is not subject to income tax.
April 1, 2020
- COVID-19 cash flow boost payments are not subject to income tax
A Bill is before Parliament which will effectively offset superannuation tax for super guarantee contributions for people earning up to $37,000. However, this benefit will only be available if the Minerals Resource Rent Tax package of Bills also passes through the Parliament.If those conditions are met, the offset will take effect from July 2012.
The offset will take place by way of a low income superannuation contribution of up to $500 for individuals to their super fund.The $500 limit is calculated as $37,000 x 9% x 15% = $500.
To be eligible you will need to:
+ Have some concessional contributions for the year;
+ Have an adjusted taxable income that does not exceed $37,000; and
+ Pass an income test where 10% or more of your income is derived from employment or business;
The low income superannuation contribution must be for at least $20 or more and temporary residents are not eligible.
This new low income superannuation contribution (offset) is distinguished from the existing Government co-contribution which is matched to non-concessional contributions by low-income earners.
The concessional contributions that are eligible include:
+ Employer super guarantee contributions;
+ Contributions made under a salary sacrifice arrangement;
+ Tax deductible personal contributions; and
+ Certain allocations from reserves and notional tax contributions for defined benefit funds.
The low-income superannuation contribution will not be assessed for tax in the super fund.Tax Laws Amendment (Stronger, Fairer, Simpler and Other Measures) Bill 2011, WTB 1741
