Personal Income Tax Changes
This years’ Federal budget saw the government introduce the low and middle income tax offset. The non-refundable tax offset will be available for the financial years ending 30 June 2019 to 30 June 2022 and will provide a benefit of up to $200 for taxpayers with taxable incomes of $37,000 or less. Between $37,000 and $48,000 the offset will increase at a rate of 3 cents per dollar to the maximum benefit of $530.
The benefit of the Low and Middle Income Tax Offset is in addition to the Low Income Tax Offset
The Government will also implement the following measures designed to protect middle income earners from bracket creep:
- From 1 July 2018, the top threshold of the 32.5% personal income tax bracket will be increased from $87,000 to $90,000, which will then be further increased from 1 July 2022 to $120,000.
- From 1 July 2022, the Government will extend the 19% personal income tax bracket from $37,000 to $41,000; and further increase the top threshold of the 32.5% tax personal income tax bracket from $90,000 to $120,000; and
From 1 July 2024, the Government will extend the top threshold of the 32.5% personal income tax bracket from $120,000 to $200,000.