What’s changed from 1 July 2016

Business

  • New initiatives offer tax incentives for investment in early stage innovation companies.
  • Simplified rollover rules commence enabling small businesses to restructure their business operations without triggering adverse implications under the income tax system.

You and your family

  • Large Family Supplement abolished.
  • Family Tax Benefit B removed for couples whose youngest child is 13 years of age or over (instead of 18 years). The changes do not affect single parents or grandparents, but grandparents must register to continue to receive the payment.
  • If you are out of the country, the Family Tax Benefit, child care payments, Double Orphan Pension, and Single Income Family Supplement will now only be paid for 6 weeks (instead of 56) while you are temporarily overseas.
  • Higher Education Loan Programme (HELP) debtors residing overseas for 6 months or more need to make repayments of their HELP debt if their worldwide income exceeds the minimum repayment threshold at the same repayment rates as debtors in Australia.

Superannuation – SMSF’s

Strict compliance rules for collectable and personal use assets now apply universally.   Any collectables or personal use assets held within your SMSF, regardless of when you acquired them, must meet the following strict compliance requirements:

  • The asset cannot be leased to a related party;
  • The asset cannot be stored in the residence of a related party;
  • The asset cannot be used for personal use;
  • Trustees must record a decision on where the asset is kept; and
  • The asset must be insured in the trustee’s name within 7 days.

Foreign Residents – Withholding Obligation

New rules to prevent foreign residents avoiding tax when they sell certain Australian assets will affect everyone buying or selling property with a market value of $2 million or more. The 10% withholding obligation applies from 1 July 2016. Many transactions involving shares in a company or units in a trust will also be caught.