15 Nov Federal Budget October 2022 Summary
Treasurer Jim Chalmers has handed down the Labor Government’s first Budget, outlining a range of key measures. Should you wish to discuss how this may impact you personally, please contact your EQ8 representative directly.
Some key highlights from the budget are:
Superannuation – Expanding the eligibility for downsizer contributions
The Government is set to allow more people to make downsizer contributions to their superannuation, by reducing the minimum eligibility age from 60 to 55 years of age. The measure will have effect from the start of the first quarter after the Royal Assent of the enabling legislation.
The downsizer contribution allows people to make a one-off post-tax contribution to their superannuation of up to $300,000 per person from the proceeds of selling their home. Both members of a couple can contribute, and contributions do not count towards non-concessional contribution caps.
Additionally, the Government also announced further non-tax measures to reduce the financial impact on pensioners looking to downsize their homes. This was done to reduce the burden on older Australians and free up housing for younger families.
FBT – Electric cars
From 1 July 2022, the measure will exempt battery, hydrogen fuel cell and plug-in hybrid electric cars from fringe benefits tax and import tariffs if they have a first retail price below the luxury car tax threshold for fuel-efficient cars. The car must not have been held or used before 1 July 2022. Employers will need to include exempt electric car fringe benefits in an employee’s reportable fringe benefits amount.
COVID-19 business grants – Making COVID-19 business grants non-assessable non-exempt
In response to COVID-19, payments from certain state and territory business grants, made prior to 30 June 2022, can be made non-assessable and non-exempt for income tax purposes, subject to eligibility. This tax treatment is only provided in exceptional circumstances, such as the severe economic consequences facing businesses during the COVID-19 pandemic.
Energy Efficiency Grants for small and medium-sized enterprises
The Government will provide funding to support small to medium enterprises to fund energy-efficient equipment upgrades. The funding will support studies, planning, equipment and facility upgrade projects that will improve energy efficiency, reduce emissions or improve the management of power demand.
Boosting Paid Parental Leave
The Government outlined a cheaper childcare scheme aimed at getting more parents back into the workforce, with paid parental leave expansions supporting this further. The Government has announced it will introduce reforms from 1 July 2023 to make the Paid Parental Leave Scheme flexible for families so that either parent is able to claim the payment and both birth parents and non-birth parents are allowed to receive the payment if they meet the eligibility criteria. This scheme allows parents to claim weeks of payment concurrently so they can take leave at the same time.
Supporting Small Business Owners
The Government will provide $15.1 million over two calendar years from 1 January 2023 until 31 December 2024 to extend the Small Business Debt Helpline and the NewAccess for Small Business Owners programs to support the financial and mental well-being of small business owners.