We have just emailed out our summary of the 2010 Budget as it relates to personal finances and financial planning strategies.
This year's budget has provided a number of significant changes impacting on financial planning strategies.These have been outlined in this summary.The major changes include:
-Confirmation of income tax changes from July 1st 2010 increasing the effective tax free threshold from $15,000 to $16,000 for those earning $30,000 or less, the bottom of the 30% marginal tax rate threshold increasing from $35,000 to $37,000 and the current 38% marginal tax rate being reduced to 37%.
-A 50% discount commencing July 1st, 2011 on the tax payable on the first $1,000 of interest income generated by bank, credit union and building society accounts along with income from bonds, debentures and annuity products.
-A $500 standard deduction for work related expenses starting 2012-13, increasing to $1,000 for 2013-14 to simplify tax returns and lead to tax savings for many individuals.
-Superannuation guarantee contributions to rise from the current 9% to 12% by July 2019.
-A $500 superannuation tax rebate, commencing July 1st, 2012, of the contributions tax for those with incomes of up to $37,000.
-The superannuation guarantee age limit to rise from 70 to 75 starting July 1st 2013.
-A reduction in the company tax rate from 30% to 29% in 2013-14 and 28% in 2014-15.
-The company tax rate reductions to be brought forward for small businesses with the rate of 28% applicable from 2012-13.
-Small businesses to be able to immediately write off asset purchases of less than $5,000 compared to the current limit of $1,000.
-A permanent extension from 1st July 2012 of the eligibility for those over 50 to receive $50,000 of concessional contributions into super p.a. as long as superannuation balances do not exceed $500,000.
-The Net Medical Expenses Tax Offset to increase from $1,500 to $2,000
This Summary has been prepared as a brief summary of the 2010 Federal Budget as it impacts on personal finances.It is a publication of A Clear Direction Financial Planning.It contains general financial information.Readers should check this information with a professional financial adviser before acting on any of the material contained in this document.