Tax Changes From 1 July 2017

There are many tax changes in effect from 1 July 2017. Here we provide a summary of Superannuation, Personal Tax and Business Tax changes that you need to be aware of.

Superannuation

• Concessional Contribution Limits (tax deductible): will be reduced down to $25K cap for everyone.
• Non Concessional Contribution Limits (not deductible): new yearly cap of $100K to replace the current $180K 2016/17 cap (with a lifetime cap of $500K).
• Division 293 Threshold: the threshold will reduce to $250K, meaning those who earn over this threshold (inc super contributions) will be required to pay 30% tax on super contributions (compared to 15%).
• Pension Balance Cap at $1.6mil: members can have a maximum balance of $1.6mil in pension mode (with earnings on these being tax free in the fund), with the balance to remain in accumulation mode (earnings on these being taxed at 15%).

Personal Tax

• Super Contribution Deductions: contributions can be paid directly into super by individuals and claimed it their personal tax returns.
• Transition to Retirement Pensions: previously if individuals were over 60 years of age, these pensions would be tax free. From 1 July 2017, these earnings will be taxed at up to 15%.

Business

• Small Business Capital Asset Write Off: the government will extend the current instant asset write off of $20,000 for small business (under $10mil turnover) to 30 June 2018
• Small Business Turnover Limit: the 2016/17 threshold is currently $10mil, but will increase to $25mil from 1 July 2017, allowing more business’ to be classified as Small Business, and access tax concessions (subject to approval from House of Reps).

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.