Adjustments come with each new financial year. Below are some of the significant tax changes in Australia for the 2012-13 year.
This year the tax-free threshold increases more than three-fold to A$18,200. This is great news for low income earners, and also means anyone earning less than A$80,000 should be better off this financial year. The new tax thresholds from 1 July 2012 are:
Income range ($) Tax rate (%)
0 18,200 Nil
18,201 37,000 19
37,001 80,000 32.5
80,001 180,000 37
Medical expenses tax offset
The 20 per cent medical expenses offset will increase from A$2060 last financial year to A$5000 this year. For individuals with income exceeding A$84,000 (or A$168,000 for couples) the medical expenses offset will decrease to 10 per cent.
Medicare levy surcharge
The Medicare levy surcharge will apply to individuals whose income exceeds A$84,000 or couples who exceed A$168,000, a slight increase on last year’s respective figures of A$80,000 and A$160,000.
Private health insurance rebates
From July 1 private health insurance rebates will be income tested, which means those earning more than A$84,000 for individuals and A$168,000 for couples will likely receive less than the 30 per cent offset previously obtained. Full details of the rebates can be found at http://www.health.gov.au/privatehealth.
Concessional superannuation contributions cap
For the 2012-13 year all taxpayers, regardless of age, will have their concessional superannuation contributions capped to A$25,000.
For individuals with income greater than A$300,000 the tax rate on concessional superannuation contributions will double. This is achieved by having the tax concession on their concessional contributions reduced from 30 per cent to 15 per cent.
The maximum co-contribution amount payable has been halved to A$500 for this financial year (previously A$1000).
The carbon tax is here. Approximately 500 businesses will be liable for the tax, but the cost is expected to flow through to all individuals and business. Many Australian households will be eligible for extra payments to offset these costs as well as tax cuts for low- to middle-income earners. Details of these benefits can be found at http://householdassistance.fahcsia.gov.au/.