2017 Budget: The Good, The Bad & The Ugly

The good, the bad and the ugly. Accountant, Vanessa Mendes gives us the low-down on the Budget.

The good, the bad and the ugly. Accountant, Vanessa Mendes gives us the low-down on the Budget.

THE GOOD:

School Students and Teachers

The Federal Government will give schools an extra $18.6 billion over 10 years which is great and they are also standardising funding allocation now meaning approximately 51 private and catholic schools funding will be cut or frozen.  Around 24 elite private school have been identified by the government as being overfunded.

National Disability Insurance Scheme

The NDIS scheme has been fully funded with the money coming from an increase to our Medicare Levy!  Yes, it’s more tax we pay but our budget is in deficit and funding the NDIS is important so we’re happy to pay.

Small Businesses

The Government is looking to extend the $20,000 immediate write-off for small businesses by a further 12 months through to 30 June 2018.  The concession will be available for businesses with an annual turnover less than $10 million.

THE BAD:

Taxpayers

An increase of 0.5% to the Medicare Levy will take this to 2.5% of our taxable income for individuals. This increase will primarily help fund the $22 billion needed for the NDIS Scheme.  You will see this kick in 1 July 2019.

Rental Property Owners

From 1 July 2017, the Government will limit depreciation deductions for rental property owners to costs actually incurred by the owner themselves. 

Smokers

Contributing more than $360 million to the budget over the next four years are the roll-your-own tobacco or cigars smokers, bringing them into line with the tax rates on cigarettes.  This will be phased in, so time to take action, save some cash and kick those bad habits!

THE FENCE-SITTERS:

Property Developers

Property developers will no longer manage the GST collected on sales of new residential properties or new subdivisions. Instead, the government will require GST to be remitted directly to the ATO as part of the settlement process.

Contractors

Cleaners and Couriers will no longer fly under the radar with the Government extending the Taxable Payments Reporting System (TPRS) to contractors in the courier and cleaning industries from 1 July 2018. Under the TPRS, businesses are required to report details of payments they make to contractors each year to the ATO.