BUDGET2016 | The effect of the double dissolution
The 2016 Federal Budget proposed a range of changes, including some to income tax brackets.
By now, you will also have seen that the government has now dissolved and is in caretaker mode ahead of the election in July.
What this means is that the Budget will NOT become law until the new government is appointed. Whether or not the Budget measures are approved depends on the party that ends up forming the government.
What does this mean for you?
This means that the ATO will only be updating the tax tables on items that have already been passed into Law. These predominantly relate to HELP and SSTS levels and those tables have been released already. Our team is preparing for implementation of those at the moment.
There is also a Medicare levy change that will implemented as that received Royal Assent on 4 May 2016.
For more information about the Medicare levy, please see the ATO website.
The Tax Commissioner has the ability to implement a measure ahead of the policy becoming law and they will do that when they are sure that this will occur.
Again, whether or not this will be implemented depends on who is the ultimate victor in the upcoming federal election.
The Commissioner needs to make a decision by mid-August to factor in the company tax cuts for PAYG instalments for the first quarter and at this stage they will also look at the personal income tax thresholds.
Whatever the outcome of the Australian federal election, rest assured that MYOB is working hard to make sure all the changes are reflected in your software.