This new ATO legislation will bring about changes to the tax thresholds for income and tax offsets.
The ATO has decided to implement a range of changes so that any taxpayers who may have already submitted their 2018-2019 tax return will get an increase to their entitlements for both low and middle-income tax offset entitlements.
If a tax refund is due, then this will be deposited into the individuals chosen bank account, and there is no need to physically request any amendments.
From 12th July 2019, the assessment for tax returns that have already been submitted with begin.
The Finer Details
As a non-refundable off-set, any low- or middle-income tax offset that is unused will not be refunded. This offset will directly decrease the tax amount that is payable, but it will not decrease the levy for medicare.
The ATO has provided an income tax estimator that will help you get an estimate for the amount of tax you need to pay.
Here is the exact breakdown for the 2018-2019 income year.
- For taxpayers with a taxable income in excess of $90k, without being more than $126k; they will become eligible for a tax offset of up to $1080; less than a value that is equal to 3% of the total excess.
- Any taxpayers in Australia with a taxable income that is no greater than $37k will now be eligible for an offset of up to $255.
- Any taxpayers in Australia with a taxable income that is greater than $37k but less than $48k will now be eligible for an offset of up to $255, with an additional amount that is equal to 7.5% of the overall maximum offset of $1080.
- The offset for low-and-middle-income has been increased from a maximum amount of $530 to $1080 annually.
- Any taxpayers who have a taxable income that is greater than $48k, but lower than $90k will now be eligible for the maximum lower- and middle-income tax offset of $1080.
These changes will mean that potentially millions of Australians could receive an unexpected payout, and going forward, there will be lower taxes for hard-working Australians.