Budget personal tax cuts and business concessions now law
Several tax announcements from the 2020 Federal Budget have now been passed into law.
Personal tax cuts brought forward to 1 July 2020
In the Budget, the Government announced that it will bring forward to 1 July 2020 the personal tax cuts (Stage 2) that were previously legislated in 2018 to commence from 1 July 2022. The Stage 3 tax changes remain unchanged and commence from 1 July 2024, as previously legislated:
COVID-19 and FBT: updated ATO advice
The ATO has updated its COVID-19 and fringe benefits tax (FBT) advice, providing a useful outline of some issues that may arise due to an employer’s response to COVID-19.
TIP: Although the following summary deals with FBT specifically, it is worth thinking through the related income tax consequences. Contact us to find out more.
JobKeeper changes: turnover test and employment start date
Prime Minister Scott Morrison announced further changes to JobKeeper on 7 August 2020. The changes are intended to ensure that eligibility for the revised JobKeeper scheme – to commence on 28 September 2020 – will be based on a single quarter tax period, rather than multiple quarters as previously announced. Employees hired as at 1 July 2020 will now also be eligible to receive JobKeeper.
Treasury has updated its JobKeeper factsheets as at 7 August 2020 to incorporate the PM’s announcements.
On 21 July 2020, the Government announced that the JobKeeper Payment (‘JKP’) would be extended until 28 March 2021 (i.e., for a further six months beyond its original end date of 27 September 2020).
As a result, JKPs would now be made over two separate extension periods, being: