Temporary full expensing extended for small business as part of new bill

• Business News
• Superannuation

The Federal government has announced the extension of temporary deduction and tax incentives as part of a new bill that also sees changes to superannuation and SMSF strategies.

The amendment has extended the temporary full expensing of depreciating assets regime for small businesses by 12 months, to 30 June 2023.

This extension will provide eligible business an additional 12 months to access the tax incentives.

The changes to superannuation, initially released as part of the 2021 budget announcement, include removing the work test for contributions, removing the monthly minimum salary threshold to count towards the guarantee, and changes to downsizer contributions.

Breakdown of SMSF and Superannuation contribution changes

• Removal of the work test for superannuation contributions

The amendments allow individuals aged between 67 and 75 to make non-concessional and salary sacrifice contributions to their superannuation without the need to meet the work test.

This exemption is set to take effect as of July 1, 2022.

• Removal of the monthly minimum threshold for salary or wages to count towards the superannuation guarantee. 

Previously employers were only required to pay the superannuation guarantee once an employee earned over $450 in a month. With the removal of this threshold the guarantee will be paid regardless of the employee’s monthly earnings.

This amendment is set to commence as of July 1, 2022.

• First Home super saver scheme contribution increase

The maximum releasable amounts of voluntary contributions made under the first home super saver scheme will increase from $30,000 to $50,000.

This amendment is set to commence as of July 1, 2022.

• Downsizer contribution age limit down to 60

The reduction of the eligibility age to make downsizer contributions from age 65 to age 60, and increasing the eligibility age to utilise the bring forward rule from under age 67 to age 74 (inclusive).

This amendment is set to commence as of July 1, 2022.

• Segregated current pension assets

The amendment allows superannuation trustees to choose their preferred method of calculating exempt current pension income.

Funds obtained in full retirement phase? There may no longer be a requirement to obtain an actuarial certificate to claim exempt current pension income.

This amendment is set to take effect as of quarter two, in the 2022-23 financial year.

Find out more

To find out more about how full expensing benefits can be maximised in your business, contact Elevate Accounting on 08 9460 1040 or book your obligation free appointment online HERE.