The federal budget contains income tax cuts for most Australians, with someone on the average salary set to receive around $ 20 more each week once the cuts are passed
While portfolios are hurting right now, the government wants to see the benefits start to sink as quickly as possible
With budget laws already submitted to parliament, the government is hoping the cuts can be accelerated, meaning your employer could start cutting taxes on your paycheck within weeks.
Treasurer Josh Frydenberg has said that with the principled support of the Labor Party, the Australian Tax Office (ATO) can start changing payout rates as they go that determine how much tax your employer withholds every time you get paid
The changes announced last night are around $ 20 per additional week for a worker earning between $ 48,000 and $ 90,000, with people earning more than that getting a bigger benefit, up to a maximum from 2430 USD per year
« The ATO told us it could update its PAYG hold schedules as early as the middle of the month, » said M Frydenberg
« They can do it when they feel that this and our other tax measures are supported across Parliament
M Frydenberg said he expected the changes to put money in people’s pockets by Christmas
The tax cuts are backdated to July of this year, but you won’t have access to the benefits you would have felt between July and now until the end of fiscal year 2020-2021
« This will be processed at the end of the fiscal year as a lump sum payment, » said M Frydenberg
Shadow Treasurer Jim Chalmers said he wrote to Tax Commissioner Chris Jordan assuring him the laws would be passed
« There is no reason for the tax commissioner not to immediately apply the new scales agreed between the two major parties in parliament, » he said
An ATO spokesman said tax authorities will release updated withholding tax tables as soon as possible
« Employers may need little time to change their payroll processes and systems so that tax cuts are reflected in people’s take-home pay, » they said
People earning between $ 37,000 and $ 126,000 will also receive a one-time bonus when they file their income tax return next year, as the government will maintain tax compensation for low incomes for one more year and medium (LMITO)
The LMITO is worth $ 1,080 for people earning between $ 48,000 and $ 90,000 (the same amount they would receive under the second stage of tax cuts), gradually falling outside of this range
It was designed to promote the benefits of the second stage for low and middle income earners
But it will only be available for the 2020-21 fiscal year, which means those who benefit from it will pay more tax next year than this year.
It also comes with the catch that you can’t receive it until you file your tax return at the end of the year
« The low and middle income tax compensation takes place at the end of the fiscal year and this is because it is released from your tax paid during that year So it is a structural reason for this, ”said M Frydenberg
This service may include material from Agence France-Presse (AFP), APTN, Reuters, AAP, CNN and BBC World Service which is copyrighted and may not be reproduced
AEST = Australian Eastern Standard Time, which is 10 hours ahead of GMT (Greenwich Mean Time)
Tax Cuts 2020, Budget 2020, Federal Budget, Australia Budget 2020, Josh Frydenberg, Budget Tax Cuts, JobMaker, Australian Budget 2020, Instant Asset Write-off, Budget, Australian Budget, Australia Budget, 2020 Budget- 21, australia budget 2020
World News – AU – Tax cuts backdated to July – but you won’t get some of the money until mid-year next year
