2020/21 Federal Budget Overview

The Treasurer handed down the 2020/21 Federal Budget earlier this month.

As the Australian economy is currently in recession as a result of the COVID-19 pandemic, this budget contained a number of measures aimed at supporting job creation, business investment, skills and training and homeownership.

So what does this mean for you?

Individuals

Some of the key points are:

• Individual tax cuts will be brought forward and backdated to 1 July 2020. Lower- and middle-income earners will receive tax relief of up to $2745 for singles and up to $5490 for dual-income families due to personal income tax cuts scheduled for 2022 being brought forward.
• People who relocate to rural areas for seasonal work (even if for only 6 six weeks) can claim a relocation reimbursement of $6000.

Looking for further information? Please see the Lower Taxes Budget Government Fact Sheet here.

Businesses

Instant asset write off

• Businesses with turnover up to $5 billion will be able to deduct the full cost of eligible depreciable assets of any value in the year they are installed until June 2022. The cost of improvements to existing eligible depreciable assets made during this period can also be fully deducted.

Job Maker Hiring Credit

• From 7 October 2020, eligible employers are able to claim $200 a week for each additional eligible employee they hire aged 16 to 29 years old; and $100 a week for each additional eligible employee aged 30 to 35 years old. New jobs created until 6 October 2021 will attract the JobMaker Hiring Credit for up to 12 months from the date the new position is created. To be eligible, the employee must have received the JobSeeker Payment, Youth Allowance (Other), or Parenting Payment for at least one of the previous three months at the time of hiring.

Find out more about the Job Maker hiring credit here.

Boosting Apprentices

• The $1.2 billion Boosting Apprenticeship Commencements wage subsidy will support businesses and Group Training Organisations to take on new apprentices and trainees, to build a pipeline of skilled workers to support sustained economic recovery.
• Any businesses that engages an Australian Apprentice on or after 5 October 2020 may be eligible for a subsidy of 50 per cent of wages paid to an apprentice between 5 October 2020 and 30 September 2021, to a maximum of $7,000 per quarter.
• This assistance will support 100,000 new apprentices across Australia, and is in addition to the Supporting Apprentices and Trainees wage subsidy which is helping small and medium businesses to keep their apprentices and trainees in work and training.

Find out more here.

Want further information?

The budget comes in several volumes, or “budget papers”, printed over hundreds of pages. A budget overview can be found here.

Please consult with your accountant or financial advisor as required for advice on how to access and implement the aspects of the budget that impact you and your business.