Snapshot of the Federal Budget 2022-23
31/03/22 Written by Rob Brint
Handed down on 29 March, here are the key takeaways from the 2022-23 Federal Budget on measures that may impact businesses. For more information on measures impacting individuals, we recommend visiting budget.gov.au.
If we can assist you to take advantage of any of the Budget measures or to risk protect your position, please contact us.
What are the key highlights for business?
Fuel excise reduction for six months
New measures to address cost-of-living (including increasing the low-middle income tax offset) and assist new parents
New tax deductions for businesses to encourage digital adoption
A strong focus on skills and training to upskill the Australian workforce including new tax deductions for businesses
Apprenticeship subsidy extension
STP data sharing with states & territories
There were no changes to when super can be accessed or how much can be contributed. However, many previously announced changes to super will come into effect from 1 July this year. These include:
increasing the Superannuation Guarantee (SG) from 10% to 10.5% on 1 July 2022. It’s then legislated to increase by 0.5% each year until it reaches 12% on 1 July 2025, and
removing the $450 minimum monthly income threshold for SG contributions.
1. 50% reduction in fuel excise for 6 months
Fuel excise is set to be cut in half for 6 months from 30 March 2022. This will equate to 22.1 cents per litre in excise for petrol and diesel. The ACCC will monitor retailers to ensure the excise reductions are passed on at the pump.
2. One-off cost of living tax offset
There will be a one-off $420 increase to the low and middle income tax offset (LMITO) for 2021-22 income tax year. The combined $420 and LMITO will give eligible taxpayers a tax reduction of up to $1,500 for a single income household, or $3,000 for a dual income household.
The Government is also providing a new one-off, income tax-exempt payment of $250 to help with increases in the current cost of living. It will be paid automatically to all eligible pensioners, welfare recipients, veterans, and eligible concession card holders in April 2022.
3. Small business digitalisation
New $1 billion Technology Investment Boost to encourage small businesses to go digital. Small businesses with an annual turnover less than $50 million will be able to deduct a bonus 20% of the cost of expenses and depreciating assets that support digital uptake. This includes portable payment devices, cyber security systems or subscriptions to cloud-based services. A $1 spend will equate to a $1.20 deduction.
4. Small business training bonus
Small businesses with an annual turnover less than $50 million will have access to a new bonus 20% deduction for the cost of external training courses delivered to their employees by providers registered in Australia. Similar to the Technology Investment Boost, a $1 spend will equate to a $1.20 deduction.
5. $2.8bn for apprenticeships
New $2.8 billion investment to increase take up and completion rates for apprenticeships including $5,000 payments to new apprentices and up to $15,000 in wage subsidies for employers who take them on.
6. STP data shared with states and territories
$6.6 million over the forward estimates period is marked for the development of IT infrastructure to allow the ATO to share single touch payroll (STP) data with State and Territory Revenue Offices on an ongoing basis. This would enable payroll tax returns to be pre-filled with STP data, to reduce compliance costs for businesses.
Contact Outsource CFO if you have any questions on how to take advantage of any of the Budget measures.