1. Tax Rates
MARGINAL TAX RATES
Individual rates for 2009/10
| Taxable income |
Tax payable (residents) |
Tax payable (non-residents) |
| $0-$6,000 |
nil |
29% > $0 |
| $6,001-$35,000 |
$0 + 15% > $6,000 |
29% > $0 |
| $35,001-$80,000 |
$ 4,350 + 30% > $35,000 |
$10,150 + 30% > $35,000 |
| $80,001-$180,000 |
$17,850 + 38% > $80,000 |
$23,650 + 38% > $80,000 |
| $180,001+ |
$55,850 + 45% > $180,000 |
$61,650 + 45% > $180,000 |
MINORS
Individual rates for 2009/10
| Taxable income |
Tax payable |
| $0 to $416 |
nil |
| $417-$1,307 |
66% of each $1 over $416 |
| $1,308 + |
45% of entire amount |
Note: Minors who are Australian residents do not have to lodge a tax return if they earn less than $2,666 in 2008/09 due to tax offset of $1,200.
MEDICARE LEVY (2009/10)
| Taxable income |
No levy
wheretaxable |
Reduced levy
wheretaxable |
Full 1.5% levy
wheretaxable |
| Category |
Income |
Income |
Income |
Eligible for SATO(2009/10)
| Single |
$0 - $29,867 |
$29,868 - $35,137 |
> $35,137 |
| Couple |
$0 - $43,500 |
$43,501 - $51,177 |
> $51,177 |
Eligible for SATO(2009/10)
| Single |
$0 - $29,867 |
$29,868 - $35,137 |
> $35,137 |
| Couple |
$0 - $43,500 |
$43,501 - $51,177 |
> $51,177 |
Eligible for pensioner tax offset (2008/09)**
| Single |
$0 - $25,299 |
$25,300 - $29,343 |
> $29,343 |
| Couple |
$0 - $30,025 |
$30,026 - $35,179 |
> $35,179 |
All other taxpayers (2007/08)**
| Single |
$0 - $17,794 |
$17,795 - $20,848 |
> $20,848 |
| Couple |
$0 - $30,025 |
$30,026 - $35,179 |
> $35,179 |
Add $2,757 for each dependent child or student.
* 10c/dollar within income range for single individuals, more complex rules apply to couples.
** 2009/10 figures not available until June 2010.
MEDICARE LEVY SURCHARGE
Medicare levy surcharge (2009/10): 1% surcharge where inadequate private health insurance held and taxable income >$73,000 (single) or >$146,000 (couple/family). Family threshold increases by $1,500 per child for 2 or more children.
From 1 July 2010 the Medicare levy surcharge is:
| |
Surcharge thresholds projected 2010/11 |
Tier 1 |
Tier 2 |
Tier 3 |
| Singles |
$0-$75,000 |
$75,000-$90,000 |
$90,000-$180,000 |
$120,001+ |
| Families |
$0-$150,000 |
$150,001-$180,000 |
$180,001-$240,000 |
$240,000+ |
| Medicare levy surcharge |
NIL |
1.00% |
1.25% |
1.50% |
| Private health insurance offset Less than age 65 |
30% |
20% |
10% |
NIL |
| 65 to 69 years |
35% |
25% |
15% |
NIL |
| 70 years and over |
40% |
30% |
20% |
NIL |
2. Tax Offsets
LOW INCOME TAX OFFSET 2009/10
| Taxable income |
Tax Offset |
| $30,000 or less |
$1,350 |
| $30,001-$63,750 |
$1,350 - [(taxable income - $30,000) x .04] |
| $$53,001-$63,000 |
nil |
Based on taxable income.
PRIVATE HEALTH INSURANCE OFFSET (2009/10)
| Age of oldest person covered by the policy* |
Amount of offset as a % of premium paid |
| Less than 65 years |
30% |
| 65 years to under 70 years |
35% |
| 70 years or over |
40% |
* If the oldest person moves into the next age group during the year, the rebate is based on the number of days that person was in each group.
It is proposed to establish a tiered system to means test the health insurance offset, commencing 1 July 2010. Refer Medicare Levy Surcharge table as above.
SPOUSE CONTRIBUTION OFFSET
- Rebate of 18% available on spouse contributions up to $3,000.
- Maximum rebate of $540 is available when spouse's assessable income + reportable fringe benefits is $10,800 or less. Rebate cuts out at $13,800.
- Rebate equals the lesser of: [$3,000 - (assessable income - $10,800)] x 18% OR [total spouse contributions in that year] x 18% From 1 July 2008, superannuation laws gave same-sex couples the same entitlement to the spouse contribution offset as other couples.
MEDICAL EXPENSE OFFSET
- A 20% rebate is payable on net medical costs in excess of $1,500 that have been incurred by a taxpayer in a tax year on behalf of his/her self and any dependants. There is no upper limit on the amount that can be claimed.
SENIOR AUSTRALIANS TAX OFFSET (SATO)
Taxable Income
| SATO 2008/09 |
Rebate level |
Shade-out threshold |
Cut-out threshold |
| Single |
$2,230 |
$29,867 |
$47,707 |
| Couple(Each) |
$1,602 |
$25,680 |
$38,496 |
| Separated due to illness**(Each) |
$2,040 |
$28,600 |
$44,920 |
Note: Rebate reduces by 12.5 cents per dollar of taxable income in excess of the shadeout thresholds.
** Estimated thresholds as at 1/6/09.
MATURE AGE WORKERS TAX OFFSET
| Taxable income |
Tax Offset |
| $10,000 or less |
5% of income |
| $10,001-$53,000 |
$500 |
| $$53,001-$63,000 |
$500 - [0.05 x (taxable income - $53,000)] |
3. Super Contributions
CONCESSIONAL CONTRIBUTIONS From 1 July 2009, for people under age 50 the limit will reduce from $50,000 to $25,000 per person per year (indexed annually from 1 July 2010) and for people age 50 or over, the limit will reduce from $100,000 to $50,000 per person per year for three years until 30 June 2012. From 1 July 2012 the limit will be the same for all, ie. $25,000 per person per year (indexed).
NON-CONCESSIONAL CONTRIBUTIONS
A limit of $150,000 per person per year (2007/08 and 2008/09) applies. Individuals under age 65 can bring forward 2 years worth of contributions for a $450,000 limit to apply over 3 years. The non-concessional contribution limit was due to increase to $165,000 from 1 July 2009, however the limit will remain at $150,000.
GOVERNMENT CO-CONTRIBUTION
The government will make a $1.50 contribution for every $1 of personal contributions made in 2008/09 by employees with assessable income plus reportable fringe benefits of $30,342 p.a. or less. This represents a cocontribution rate of 150%. The maximum co-contribution ($1,500) reduces by 5 cents per dollar over $30,342. No co-contribution will be paid once assessable income plus reportable fringe benefits equals $60,342 p.a.
From 1 July 2009 the matching rate and maximum co-contribution that is payable on an individual's eligible personal non-concessional superannuation contributions has been temporarily reduced as follows:
| |
2009/10 |
2010/11 |
2011/12 |
2012/13 |
2013/14 |
2014/15 |
| Maximum co-contribution |
$1,000 |
$1,000 |
$1,000 |
$1,250 |
$1,250 |
$1,500 |
| Reduction for each $1 of total income above shade-out threshold |
3.33 cents |
3.33 cents |
3.33 cents |
4.17 cents |
4.17 cents |
5 cents |
From 1 July 2014, the co-contribution rate will return to 150%. The income thresholds remain the same.
4. Negatively Geared Property
- Is your property positively geared? That is you have a substantial amount of equity in it. If so you may wish to review the viability of your debt level.
- Lower interest rates will reduce your deductions.
- You may wish to consider alternate investments using an increased loan if that is appropriate as the funding source.
- Contact us for a complete comprehensive analysis of your investment property where we calculate;
i. The Internal Rate of Return and the
ii. Gross and net after tax cost or profit and much more.