When it comes to running a business in Australia, tax rates, parental leave, child care and managing your workforce are just some of the subjects that impact on your day-to-day business.
So how will last night’s announcement of the 2015-16 federal budget affect your business and your people?
Here’s a brief round-up of what the budget means for employers. But don’t forget—the proposals may change as legislation passes through parliament.
Encouraging young people into work
The Government is encouraging young Australians to join the workforce by:
- Funding a new youth employment strategy with $330 million.
- Providing $18 million over four years for around 6,000 job seekers annually to undertake valuable work experience for up to four weeks while they continue to receive income support.
The Treasurer, during the delivery of his Federal Budget speech, confirmed that there will be “no new taxes on superannuation under this government”.
There was only one small change to super in this year’s budget, which helps give terminally ill patients earlier access to their super.
Reforming child care payments [proposed from 1 July 2017]
A new single child care subsidy (CCS) will aim to meet the cost of child care for parents engaged in work, training, study or other recognised activity.
The CSS replaces the child care benefit, the child care rebate and the jobs, education and training child care fee assistance.
Removing double dipping on paid parental leave [proposed from 1 July 2016]
Eligible parents will no longer be able to receive payments from both their employer and the government’s paid parental leave pay (PPLP) scheme. However, all primary carers will have access to parental leave payments that are at least equal to the maximum PPLP benefit (currently 18 weeks at the national minimum wage).
Rationalisation of work-related car expense deductions
The government is rationalising the rules around work-related car expense tax deductions. This doesn’t affect car leasing and salary sacrifice/fringe benefits arrangements.
Giving tax breaks to small businesses
The government has announced a number of tax breaks for businesses with an aggregated annual turnover of less than $2 million.
- Corporate tax rate reduced from 30% to 28.5%. [proposed from 1 July 2015]
- Unincorporated small businesses will be eligible for a 5% business income tax offset, capped at $1,000 a year.
- Fringe benefits tax changes for work-related electronic devices. [proposed from 1 April 2016]
- Capital gains tax roll-over relief for business entity restructures. [proposed from 1 July 2016]
- Immediate tax deductions for assets under $20,000. [from 7.30pm on 12 May 2015 until 30 June 2017]
Plus some other tax changes
There were no changes to personal tax rates. However there were some changes to fringe benefit tax for exempt employers, temporary working holiday makers and employee share schemes.
Rebalancing pension asset test thresholds [proposed from 1 Jan 2017]
The Government has announced changes to the assets test thresholds for the age pension.
Defined benefit pensions [proposed from 1 Jan 2016]
If you have defined benefit pension members, please note there was a change to the deductible amount under the Centrelink income test.
Budget snapshot for your employees
How the budget affects you and your employees personally will depend on each person’s circumstances and where they’re at in life. Here are some key callouts.
Just starting out
Nearing retirement or retired
But don’t forget—the proposals may change as legislation passes through parliament.
Like to know more?
To find out more about how the budget could affect you or your business, go to www.budget.gov.au.