Monthly Archives: April 2022

How does the 2022 Federal Budget affect you?

So how does the 2022 Federal Budget affect you?

What do you stand to gain?

What do you stand to lose?

We have written our tips and traps newsletter as to how the 2022 Federal Budget affects the typical small & medium sized business as well as individuals.

You can access it by clicking on Budget 2022 Tips & Traps

In coming weeks we will be amending our pre year end planning checklist accordingly.  We so look forward to the valuable process of ensuring clients take up all benefits and avoid any pitfalls.

Whilst we will be on the front foot proactively guiding our clients, we welcome any questions you may have.

2022 Federal Budget

Please find attached a briefing paper outlining the various announcements within the 2022 Federal Budget.  This will shortly be followed by a more detailed tips and traps analysis.

It is important to remember that a Federal Budget is only a series of announcements.  The announcements still await being passed into law even if the starting date was stated to be Tuesday night.  That said, the fuel excise reduction legislation was passed yesterday.

Moreover, we have an election just weeks away and very possibly a change of government.  Labor has already stated that they intend to hand down their own Budget later in the year should they win the election.

I take this opportunity to highlight what I believe are the 6 most important announcements that affect most clients.  Not all of these may affect you personally and other announcements may, but these are the 6 with the widest impact:-

  1. Cost of living support through the $250 cost of living payment and the $420 increase in the Low and Middle Income Tax Offset.
  2. I must admit that even with low interest rates, I didn’t see this one coming given prevailing share and property prices – an extension of the 50% minimum pension reduction for the 2022/23 year.
  3. 20% extra deduction for small business expenditure on digital adoption expenditure.
  4. 20% extra deduction for skills and training expenditure.
  5. 50% reduction in the fuel excise tax for 6 months.
  6. Covid test expenses paid by employees and employers will be tax deductible and employers will not be subject to Fringe Benefits Tax.

And as far as I can read so far, there was no announcement as to another extension of the instant asset write-off.  So this means that after 30th June 2023, small businesses will not be able to deduct in one year the full cost of any asset they buy; noting that cars are subject to a limit.  It will be some time before supply chains revert to pre-covid norms, so best to start planning any asset purchase sooner rather than later.  And remember, this means that any asset purchased must be installed ready for use before July 2023.

As I said, we will come back to you with a more detailed tips and traps analysis.  In the meantime, I leave you to read the attached briefing paper and moreover welcome any questions you may have.

You can access our briefing paper by clicking here.

Next Director Identification Number (DIN) requirement

We have made aware in past blogs of the staged requirement for directors to apply for and hold a Director Identification Number (DIN).

As of Monday night, we now enter the next DIN stage.

From Tuesday 5th April, a first time director of an Australian company must have been issued with their DIN before they apply to become a director.

Those directors that were directors before November 2021 still have until October 2022 to apply for their DIN.  But please don’t leave it until the last minute, particularly if you want to apply by paper!

Warning

Those first time directors since October 2021 have 28 days to apply for their DIN.  Those that have not applied for one are now being actively reminded.  It is good that there has been a gently, gently approach as the fines are eye watering.

Please find following the DIN registration link.

https://www.abrs.gov.au/director-identification-number/apply-director-identification-number/verify-your-identity#phone-application

Due to privacy reasons, we are prohibited from applying on your behalf – yes it does seem odd given we apply for personal Tax File Numbers and handled passports and drivers licences when applying for various state covid grants.

That said, we welcome any query you may have.

You may also wish to view our past blogs on DINs.