Tax bonus payment: Do you qualify; how do you receive the benefit?
The Federal Government has announced that many Australians will receive a one-off tax bonus payment from April 2009, so do you qualify, how much will you get and you how do you make sure you receive the benefit?
The payment is part of the government’s $42 billion economic stimulus package designed to help the economy move forward. Under the plan:
- A $900 bonus will be paid to taxpayers with taxable income up to and including $80,000.
- A $600 bonus will be paid to taxpayers with income between $80,000 and $90,000.
- A $250 bonus will be paid to taxpayers with income between $90,000 and $100,000.
To be eligible for the payment you don’t need to apply. However, you do need to make sure you lodge your tax return for the 2007-08 financial year by 30 June 2009. In addition, only people who have paid tax during the 2007-08 financial year will be eligible.
If you haven’t yet lodged your tax return you need to act now. Contact Davenports Financial Solutions for an appointment. You should also contact Davenports if you want further information on the tax bonus payment or you need further assistance.
Payments of between $900 and $950 will also be made to:
- Single-income families who are entitled to Family Tax Benefit Part B.
- Farmers and others who receive Exceptional Circumstances related income support.
- Students, those returning to study or training and some income support recipients.
- Low and middle-income families who have school-aged children and are eligible for Family Tax Benefit A.
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Investment allowance: make sure your business doesn’t miss out
Many small businesses will benefit by the Government’s decision to provide an additional $2.7 billion temporary tax break to small and other businesses to boost business investment.
Small businesses (with a turnover of $2 million a year or less) will be able to access the tax break for assets costing $1000 or more. For all other businesses, the asset threshold is $10,000.
Under the plan:
- Business will receive an additional tax deduction for assets acquired from 13 December 2008 to 30 June 2009, as long as the asset is installed before 30 June 2010. The deduction will be equal to 30 per cent of the asset's cost.
- For assets acquired between 1 July 2009 and 31 December 2009 the deduction is 10 per cent of the asset's cost. The assets must be installed ready for use before 31 December 2010.
- The tax deduction is on top of the usual asset depreciation deduction able to be claimed by businesses.
- The tax break will be available for new expenditure on existing assets as well as for new assets. The assets must be used in Australia.
The extra deduction is on top of the 10% temporary investment allowance announced by the Government in December 2008.
Under the December announcement, expenditure on new tangible depreciating assets incurred after 12 December 2008 and before 1 July 2009 may qualify for a 10% investment allowance. That investment allowance will be equal to 10% of the cost of qualifying assets and will be available to businesses who acquire new tangible depreciating assets which cost more than $10,000. Tangible depreciating assets include most types of plant and equipment, vehicles and other assets that are used by businesses.
As with many tax issues the recent announcements can be confusing for many people. That’s why it’s important to act immediately and talk to the experts at Davenports Financial Solutions. We can advise you of your entitlements and help you make a claim if you are eligible.
Having a thorough understanding of new legislation is just one of the ways the team at Davenports can ensure you pay the minimum amount of tax legally payable.
The Australian Government's Treasury Department has released a frequently asked questions document on the tax breaks. To view the document, click here.