Federal Budget 2022 snap-shot for businesses, apprentices & individuals

To help you navigate your way around the latest Federal Budget changes  – here is a snap-shot of what you need to know for your business & for individuals

For businesses and apprentices:

Government, House

  • 20% tax breaks on training and digital work expenses for small businesses
  • Up to $15,000 wage subsidies for employers who take on new apprentices
  • Boosts to various apprenticeship programs to support more training places for eligible young apprentices including $5,000 in payments over 2 years for new apprentices in priority industries (eg. Tradies – carpenters, tilers, plumbers, chefs etc) from July 1
  • Tax Breaks for small businesses with aggregated annual turnover less than $50m that continue to train workers in new skills
  • Reduction in the company tax rate for small businesses. 25% tax rate for 2021-22 year.
  • Unincorporated small business tax discount rate to 16% for 2021-21 (with a $1,000 cap).
  • Encouraging business investment and supporting cash flow includes a reduction in the GDP uplift rate for 2022-2023 year, delivering $1.85b in cash flow support to 2.3 million taxpayers and small businesses.
  • Changes to the rules allowing businesses less than $5b annual turnover to instantly write off assets that strengthen business investment, extended  30 June 2023.
  • Technology Investment Boost to encourage small businesses with less than $50m annual turnover to access a bonus of 20% deduction for cost of expenses and depreciating assets that support digital uptake, up to $100k per year and valid from Budget night until 30 June 2023
  • Investment in digital capabilities via Digital Economy Strategy which is designed to provide support for business to boost productivity to become globally competitive allows for 120% tax deduction for eligible expenses and depreciating assets to support digital adoption including e-invoicing, portable payment devices, cyber security and cloud based systems and subscription services capped at $100k per year.  Effective from Budget night until 30 June 2023. Expenditure incurred by 30 June 2022 will be eligible for the additional 20% boost in the tax return for the following year (2022-2023 income tax return).
  • Skills and Training Boost with access to a new bonus deduction of 20% for the cost of external training courses delivered to employees by providers registered in Australia for small businesses with an annual turnover of less than $50 million. There are exclusions and is valid from Budget night until 30 June 2024.  Eligible expenditure incurred by 30 June 2022, the boost will be claimed in tax returns for the following income year, however expenses incurred 1 July 2022 to 30 June 2023 will be claimable in that year.
  • Super Guarantee Rate Changes includes from 1 July 2022, the amount of super will increase from 10% to 10.5% of salary and wages.  Super rate will continue to increase yearly by 0.5% until it reaches 12% in 2026.
  • Removal of the Super $450 threshold amount from 1 July 2022.  Everyone over 18 will be paid super on every dollar earned.

For individuals:

Business, Woman

  • One-off Cost of Living Tax Offset payment of $420 for individuals who earn under $126,000, paid through your 2021-22 tax return.
  • Temporary fuel excise relief to ease the pressure from rising fuel costs by a reduction of 50% for 6 months to ease pressure on motorists.
  • Home Guarantee Scheme boosted to help Australians to enter the property market with a smaller deposit.
    • 35,000 guarantees to support first home buyers with a deposit as low as 5%.
    • 10,000 guarantees to support first home buyers in regional areas with a 5% deposit.
    • 5,000 guarantees to help eligible single partners with children buy their first home or re-enter the market with a deposit of as little as 2%.
  • First Home Super Saver Scheme has been expanded with the maximum amount of voluntary contributions that can be released changed from $30,000 to $50,000

Please get in touch if you would like us to guide you through any of these changes and of course for all of your Bookkeeping and Advisory needs, we look forward to speaking to you.

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Contact us if you have any questions or want to discuss the next steps for your business.

The 2 Peas Team

P: 1300 896 732

E: admin@twopeas.com.au