On Tuesday, 2 April 2019, Treasurer Josh Frydenberg handed down the 2019-20 Federal Budget.

Below we list the key tax changes:


The Government announced it will provide a further reduction in tax through the low and middle income tax offset (LMITO) and personal income tax rates (PIT).

Tax Offset

The LMITO will increase to a maximum of $1,080 p.a applying from the 2018/19 tax returns.

Personal Tax Rates

From 1st July 2022, the top threshold of the 19% PIT bracket will increase to $45,000 (up from $41,000). From 1 July 2024, the 32.5% marginal tax rate will be reduced to 30% and the 37% bracket will also be abolished, so taxpayers between 45K and 200K will pay 30%.

A summary of the above changes are provided in the tables below.

Tax rates and income thresholds

Rate 2017-18                                 2018-19 to 2021-22                    2022-23 to 2023-24

Nil $0 - $18,200                              $0 - $18,200                                $0 - $18,200

19% $18,201 - 37,000                  $18,201 - 37,000                       $18,201 - 45,000

32.5% $37,001 - $87,000             $37,001 - $90,000                   $45,001 - $120,000

37% $87,001 - $180,000               $90,001 - $180,000                 $120,001 - $180,000

45% $180,001 +                             $180,001 +                                  $180,001 +

Tax rates and income thresholds 2024-25 onwards

Rates from 2024-25                 New thresholds from 2024-25

Nil                                                  $0 - $18,200

19%                                              $18,201 - 45,000

30%                                              $45,001 - $200,000

45%                                             $200,000 +


Instant asset write-off

The instant asset write-off threshold for small businesses (with an aggregated turnover of less than $10m) will be increased to $30,000 for eligible assets that are first used, or installed ready for use, from 2 April 2019 to 30 June 2020.

Medium sized businesses (with aggregated annual turnover of $10m or more, but less than $50m) will also be able to immediately deduct purchases of eligible assets costing less than $30,000 that are first used, or installed ready for use, from Budget night to 30 June 2020.

Corporate Tax Rate

The Government also said it would accelerate tax cuts for small businesses, with the tax rate for businesses with turnover of less than $50m cut to 25% in 2021-22.


Super contributions work test The Budget confirmed that individuals aged 65 and 66 will be able to make voluntary superannuation contributions from 1 July 2020 (both concessional and non-concessional) without needing to meet the contributions work test.

Spouse contributions age limit increase The age limit for making spouse contributions will be increased from 69 to 74.

Important: Clients should not act solely on the basis of the material contained in this newsletter. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Client Alert is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval.

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Peter Wohl
Director Summit Group, Aged Care Provider