Key Changes for Individuals and Business from 1 July 2018

The start of the financial year brings new changes that will impact small businesses and some individuals from 1 July 2018. Below are the key highlights to be aware of and ensure you are abreast of changes and have put measures in place to ensure you don’t get caught out.

BUSINESS

Single Touch Payroll – The ATO will introduce Single Touch Payroll (STP) for any business that employs 20 or more employees (based on head count at 1 April 2018). This means you will need to have the correct payroll systems in place to allow you to report to the ATO each time you pay your employees.

Increase to National Minimum Wage – From 1 July 2018, the national minimum wage will increase in Australian by 3.5%. The new national minimum wage is $719.20 per week, for a 38-hour week or $18.93 per hour.

GST on Low Cost Imports under $1,000 – GST will apply to retail sales of low value physical goods ($1000 or less) that have been imported to Australia and sold to consumers. The existing processes to collect GST on imports above $1000 at the border are unchanged.

27.5% Company Tax Rate Turnover Threshold increase – the aggregated turnover threshold for companies to access the 27.5% company tax rate will increase from $25 million to $50 million

INDIVIDUALS

Withholding Tax obligations on Property Transactions – The way GST is collected on sales of newly constructed residential properties or new subdivisions will change from 1 July. Purchases of new residential premises or subdivision of potential residential land may be required to withhold GST from the contract price and remit it to the ATO on or before settlement.

SUPERANNUATION

SMSFs Event Based Report to start – A new reporting regime commences for SMSFs. All SMSFs must report events that affect their members’ transfer balance accounts (for example, when an SMSF member first starts to receive a pension from their fund). Timeframes for reporting are determined by the total superannuation balances of the SMSF’s members.

Carry forward concessional contributions – people with super balances below $500,000 will be able to rollover their unused concessional caps for up to 5 years. Unused cap amounts can be carried forward from the 2018-19 financial year; which means the first opportunity to use these new rules will be 2019-20.

Downsizer contributions – if you are over 65, have held your home for 10 years or more and are looking to sell, you might be able to contribute some of the proceeds of the sale of your home to superannuation.

If you are concerned about how these changes may impact your or your business, contact our office to discuss your circumstances and we can help.

We are a small business accounting service located on the beautiful Sunshine Coast and would appreciate the opportunity to help you, your friends, family and colleagues. Contact us on 07 5451 1118 for an obligation-free confidential discussion today.