How does the Budget impact individuals?

Here are some of the measures that have come out of the Budget and how they impact individuals.

Low and middle-income earners – tax cuts

 Bringing forward personal income tax cuts that have already been legislated for. Such cuts are a substitute for wage increases. The tax reduction increases the available cash in the hand of the household.

  • This tax cut is a deduction against tax payable reducing the tax that is payable. It is available only to those that have taxable income and file tax returns and will not be refundable.
  • With the filing of the 2018-19 tax return, single income families earning up to $126,000 will receive an immediate tax reduction of $1,080. For dual income families, this reduction will be $2,080. These cuts immediately increase available cash to the household. Over 4.5m personal taxpayers will enjoy the full benefit and another 5.5m will enjoy a progressively lower benefit.
  • From 1 July 2024, for those earning between $45,000 – $200,000, the tax rate of 32.5% is reduced to 30%. This will mean that from that date, 94% of personal taxpayers will be on a tax rate of no more than 30%.
  • From 2023-24 there will be four tax rates for all personal taxpayers:
Taxable income Tax rate
Up to $18,200 Nil
$18,201 – $45,000 19%
$45,001 – $200,000 30%
$200,001 + 45%
  • By 2024-25, 60% of all personal income tax will be paid by the top 20% of taxpayers.

Energy Assistance Payment to pensioners and those receiving support payments

  • Before 30 June 2019, a one-off cash payment may be offered to pensioners and those receiving support payments to assist with the payment of energy accounts. Payments are to be $75 for singles and $125 for couples.

Read more in our complete April 2019 Taxwise Budget Newsletter here

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