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2022-23 Federal Budget

Here are some key changes in the Federal Budget that may affect you



Personal Income Tax

Digital Currency Clarification:

Digital currencies (Bitcoin, Etherium, Tether, Etc) will continue to be excluded from the typical Australian tax treatment of foreign currency. The current continuing tax treatment includes the capital gains tax treatment in which they are held as an investment.


NOTE: This exclusion does not apply to digital currency issued and/or held under authority of a government agency, which will remain to be taxed as foreign currency.


Extend ATO Compliance Programs - Personal Income Taxation:

The Government will provide $80.3 million to extend the Personal Income Taxation Program for 2 years starting 1-July-2023.


This extension will enable the ATO to maintain their current support in proactive, preventative, and corrective strategies in areas of non-compliance. This allows for the ATO to modernise its products and engage with taxpayers, agents and specifically target its activity.


Business Owners

Depreciation:

The Government will be reversing the decision announced in the 2021-22 Budget, allowing taxpayers to self-assess the effective life of intangible assets. In this reversal the effective lives of intangible depreciating assets will be set by the state, thus avoiding potential integrity concerns.


Powering Australia - Electric Car Discounts:

Taxes are being cut on electric cars! This allows for more Australians to convert to the more environmentally friendly mode of transportation.


From July 1, 2022, this measure will exempt battery, hydrogen fuel cell and plug in hybrid electric cars from fringe benefits tax. The care must not have been held or used before 1-July-2022.


Note: Employers will need to include exempt electric car fringe benefits in an employee’s reportable fringe benefits amount.


Extend ATO Shadow Economy Program:

The Government will be extending the ATO Shadow Economy Program for an additional 3 years from 1 July 2023. Enabling continued strong and co-ordinated response to target shadow economy activity, protecting revenue, and levelling the playing field for businesses.


Extend ATO Tax Avoidance Taskforce:

The Government has boosted funding by approx. $200 million per year for 4 years from 1 July 2022, additionally extending the taskforce by another year from 1 July 2025.


Paid Family and Domestic Violence Leave:

The government is providing $3.4 million over 4 years from 2022-23 to support education, technical advice, and support services for small business employers to support the legislation of 10 days paid family and domestic violence leave.


Secure Australian Jobs:

To get wages moving and to boost job security across Australia and address gender inequalities the Government is providing $43.2 million over 4 years (from 2022-23) with an additional $11.1 million per year for the foreseeable future.


Supporting Small Business Owners:

The Government will be providing $15.1 million across 2 years from January 1, 2023 – 31 December 2024, to extend the Small Business Debt Helpline and the New Access for Small Business Owners Programs to support financial and mental wellbeing of small business owners.


This change will redirect partial funds from the Australian Small Business and Family enterprise Ombudsman.


Superannuation

Commissioner of Taxation v Douglas:

The Government will provide $31.4 million over 4 years from 2022-23 (will $1.1 million per year ongoing) to remediate child support debt raised because of the Commissioner of Taxation v Douglas decision.


Superannuation - expanding eligibility for downsized contributions:

The government will be allowing more Australians to make downsizer contributions to their superannuation through the reduction of minimum age eligibility to 55 years old. This will be implemented from the start of the first quarter after Royal Assent of the enabling legislation.


This change in downsizer contribution allows individuals to make once-off post-tax contributions of up to $300,000 per person from the proceeds of selling their home.


This measure aims to encourage older Australians to downsize sooner to a home better suited to their needs, thus increasing the availability of housing for Australia’s Families.


Social Security

Child Care Subsidy Reforms Integrity Package:

In 4 years from 2022-23 the government will have achieved $173 million worth of savings in strengthening the payment integrity and accuracy of the Child Care Subsidy Program.


Under changes implemented to the family assistance legislation, electronic payment of early childhood education and care gap fees will be required. Aiming to reduce fraudulent claims of transactions and receiving of care in not occurring.


Plan for Cheaper Childcare:

The government will provide $4.7 billion over 4 years from 2022-23 ($1.7 billion per year ongoing) in order to attain cheaper childcare and easing the cost of living for Australian families and reducing barriers of workforce participation.


Boosting Parental Leave:

(Enhancing Economic Security, Support, and flexibility for Australia's Families)

The Government aims to enhance security, improve gender equality, and enhance flexibility for shared care arrangements. Allowing for $531.6 million over 4 years from 2022-23 (and $619.3 million per year ongoing).


From 1 July 2024, the Government will start expanding the scheme by an additional week a year until it reaches a full 26 weeks from 1 July 2026.


Both parents will be able to share the leave entitlement, with a proportion maintained on a “use it or lose it” basis, this aims to encourage and facilitate both parents to access the scheme and share caring responsibilities equally.


Plan for Cheaper Medicines:

The Government will be providing $787.1 million over 4 years from 2022-23 as of 1 January 2023, ($233.4 million a year ongoing), to decrease the general patient co-pay for treatments on the Pharmaceutical Benefits Scheme from $42.50 to $30.00.


Philanthropy

Deductible Gift Receipts

The amending of the tax law specifically listing Australians for Indigenous Constitution recognition as a deductible gift recipient (DGR) for donations made 1 July 2022 to 30 June 2025.


Taxpayers may claim an income tax deduction for donations of $2< to DGRs.


Housing

Housing Accord:

$350 million over 5 years from 2024-25 to support funding of an additional 10,000 affordable homes under a housing accord with state and territory governments and other such key stakeholders.


The Commonwealth Support will include availability payments over longer terms to facilitate institutional investment. This measure will provide a further 30,000 social and affordable homes over the course of the 5 years.


Safer and More Affordable Housing:

The Government will be investing $10 billion into the newly created Housing Australia Future Fund, to generate return to the fund the delivery of 30,000 social and affordable homes over the course of the 5-year budget plan and allocate $330 million for acute housing needs.


The Government will also be establishing the Regional First Home Buyers Guarantee, to support eligible citizens and residents who have lived in a regional location for >12 months to purchase their first home in that location within a minimum of 5 percent deposit.


Cyber Security

The budget will be provided $31.3 million in additional funding to provide cyber security services to agencies with fewer resources as part of it whole-of-Government Cyber Hub program.


The Government will provide $12.6 million over 4 years to combat scams and online fraud to protect Australians from financial harmful scams. Additionally, providing funding of $2 million to assist scam victims to help recover their identity.





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