There have been several significant changes to tax law for 2024.
The main change is the implementation of the amended stage 3 tax cuts
Individuals
The income tax rates for individuals for 2024-25 are as follows:
Taxable Income Marginal Rate
0 – 18,200 | 0% |
18,201 – 45,000 | 16% |
45,001 – 135,000 | 30% |
135,001 – 190,000 | 37% |
>190,001 | 45% |
Taxable Income Marginal Rate (Foreign Residents)
0 – 90,000 | 32.5% |
90,001 – 180,000 | $29,250 + 37% over 90,000 |
180,000 and over | $62,550 + 45% over 180,000 |
Plus 2.0% Medicare Levy where applicable and Medicare Levy surcharge where applicable.
- If you are due a refund, you must provide us with your bank details as the ATO will no longer issue cheques.
- The tax-free threshold is $18,200, with the low-income tax offset being $445. This means that you do not have to lodge a tax return if you are under the threshold.
- The private health insurance rebate is now income tested. You must provide us with your Health Fund Statement for us to prepare your income tax return. Each adult covered by a policy is income tested on their share of a policy to determine their rebate entitlement, irrespective of who pays the premium, and will receive an annual tax statement from their health fund.
- The government Super Co-contribution matching has been reduced to a maximum of $500 with a matching rate of 50%, with a lower threshold of $41,112 and upper threshold of $56,112.
- A three-tier Medicare Levy surcharge applies from 1/7/2012 based on adjusted taxable income for Taxpayers who are without appropriate private health insurance.
The following is a brief summary of your ATO requirements and what we will need to prepare your tax returns.
Income
Please supply your 2024 Pay As You Go payment summaries for wages, ETP’s, pensions and annuities for the year ending 30 June 2024 an any other relevant documentation for any other source of income.
Rental Properties
The ATO is maintaining a strong focus on this area. We will require all relevant receipts for income and expenses for the property for the 2024 income year. These include The Property Agents Summary, rates notices (council and water), insurances, strata fees, any information with regards to new capital purchases (such as carpet, curtains etc) or capital improvements to your property (such as replacement of kitchen and bathrooms etc) for depreciation purposes, land tax liability and interest on loans. If the property was sold during the year, we will require ALL purchase details and sale details of the property. Please note you can no longer claim travel expenses to visit an inspect a property from 01/07/2017.
Dividends and Interest
To ensure that interest and dividends are returned by taxpayers, the ATO matches information provided in tax returns with information from external sources (such as banks and financial institutions). Please ensure we have been supplied with ALL relevant bank interest information, ALL share dividend statements and managed fund annual tax statements. If shares have been sold during the year or managed funds ‘cashed in’, please provide details of dates and purchase and sale (including brokerage fees etc.), so that we can calculate any capital gain/loss correctly.
Shares
Any sales during the year we need information about the original purchase i.e. date, price and quantity.
Work related expenses (including car)
The ATO’s compliance program for 2024 focuses on over-claiming of employees’ work-related expenses. However, any expenses you wish to claim for such as travel, uniforms, subscriptions, telephone, computer equipment, stationery, training courses, union fees and self-education all need to be substantiated by receipts, logbooks, odometer readings and travel diaries (where appropriate).
Deductions
Please supply ALL relevant receipts relating to potential deductions including information relating to any donations made during the year (such as school building funds, Red Cross, etc) and Income Protection Insurance.
Superannuation Contributions
Employers must ensure that they have made sufficient superannuation contributions (currently 10 per cent) for all their employees on a quarterly basis throughout the year to avoid the risk of incurring penalties under the SGC regime. Eligible superannuation contributions for the June quarter must be paid by 28 July 2024 to avoid SGC penalties.
- Annual contributions can be made by persons on their own behalf with a full deduction up to age- based limits.
- Spouse superannuation contributions may generate a rebate of up to $540 where your spouses’ income is less than $10 800, and the rebate amount decreases when income is up to a maximum of $13 800
Rebates
Tax rebates can reduce your tax bill.
Private Health Insurance (PHI)
Your private health insurance tax statement sent to you by your health fund should be supplied as we may be able to claim the 30% rebate (if not done already by you via reduced premiums) and this is also required for the Medicare Levy Surcharge calculation (this can reduce the amount of Medicare Levy you may have to pay). Please note that the PHI rebate is now means tested
Family Tax Benefit (FTB)
Family Tax Benefit (FTB) from July 1st, 2009 can no longer be claimed through the tax system and must be claimed through the Family Assistance Office located in Centrelink offices.
Medicare levy surcharge
The threshold for the 2023-2024 income year for single taxpayers has increased to $90,000 and for married taxpayers and sole parents the family threshold (husband and spouse and one dependent) is $180,000 to which should be added $1,500 for each additional child after the first.
PAYG Instalments
All PAYG instalment paperwork needs to be supplied as we need to know the total amount paid whether each quarter or annually. We especially need details of any PAYG instalment adjustments during the year.
Record Keeping
All records are required to be held by you for 5 years, but in the case of capital gains they are to be held longer.
Capital gains
If you sell a capital asset, such as real estate or shares, you usually make a capital gain or a capital loss. This is the difference between what it cost you to acquire the asset and what you receive when you dispose of it.
You need to report capital gains and losses in your income tax return and pay tax on your capital gains. Although it’s referred to as capital gains tax (CGT), this is actually part of your income tax, not a separate tax.
When you make a capital gain, it is added to your assessable income and may significantly increase the tax you need to pay. As tax is not withheld for capital gains, you may want to work out how much tax you will owe and set aside sufficient funds to cover the relevant amount.
If you make a capital loss, you can’t claim it against your other income but you can use it to reduce a capital gain.
All assets you’ve acquired since tax on capital gains started (on 20 September 1985) are subject to CGT unless specifically excluded.”
Companies / Businesses
- Small businesses can now claim an immediate deduction for most depreciating assets up to $20,000 after 01/07/2024.
- Superannuation Guarantee rate has been increased to 11.5% from the 1/7/2024.
- All employers are required to be super stream compliant by 28/10/2016. Please call me to discuss.
- Employee payment summaries should be distributed to employees by 15th July after the end of the Financial Year.
- Company tax rate for small business with turnover of less than 2 million is 27.5%.
- Company tax rate for business’s with a turnover of $2 million dollars or more is 30%
- All superannuation contributions need to be paid and received by the relevant superannuation funds by the 28th July after the end of financial year. This is the final date of payment that can be used as a business deduction for the current financial year.
Superannuation Guarantee Rate Schedule
2018 / 2019 | 9.50% |
2019 / 2020 | 9.50% |
2020 / 2021 | 9.50% |
2021 / 2022 | 10.00% |
2022 / 2023 | 10.50% |
2023 / 2024 | 11.00% |
2024 / 2025 | 11.50% |
2025 / 2026 | 12.00% |
Capital gains
If you’re a company, you’re not entitled to any capital gains tax discount and you’ll pay 30% tax on any net capital gains. If you’re an individual, the rate paid is the same as your income tax rate for that year. For SMSF, the tax rate is 15% and the discount is 33.3% (rather than 50% for individuals).
Payroll Tax
This form of business tax is a State based but calculated on a national accumulation of salary and wages. Currently, the applicable tax rates and thresholds vary from state to state across Australia.