2020 has been an extraordinary and unprecedented year in Australian history and the Federal Budget passed by parliament earlier this month is truly reflective of this. The Morrison government is officially implementing its 2020 budget and plan to stimulate the economy and bring Australia through its first recession in over 30 years. 

At a glance, the ultimate goals of the budget are to rebuild our economy, create jobs and secure Australia’s future post-pandemic. As he announced  the budget plan, Treasurer Josh Frydenberg declared that 2020 has tested Australians like never before but that ‘the Great Depression and two world wars did not bring Australia to its knees and neither [would] Covid-19.” 

So what is the plan to keep Australia on its feet and how does this affect you? 

We sat down with Francis Rigby of Financial Advice Matters to discuss the ins and outs of this Federal Government Budget and how it will affect everyday Australians as well as business owners. You can watch that discussion by clicking here https://youtu.be/pbhh1JEPJrI

In summary, the key announcements from the budget can be split into those that affect businesses, employees and superannuation more generally. 

For Businesses 

  • Medium size businesses who have suffered a loss this year have the ability to offset that loss against a profit from a previous year.
  • Any businesses seeking to increase their number of employees are being encouraged to hire young Australians with benefits of hiring those 35 years and younger resulting in up to $10,000 in subsidised wages for a year. This is called the JobMaker Hiring Credit

For Everyday Australians 

  • The tax brackets have been stretched and this will see many everyday Australians saving on tax (for example, those earning $40,000 per annum can save up to $1,000 on tax).
  • Australians who are eligible for any Government benefits such as the Family Tax Benefit will receive an additional $250 payment.

Superannuation 

  • The Government is implementing a new ‘Your Super Comparison’ tool to assist in comparing super funds so you can ensure your super is performing.
  • Superannuation will also be transportable in that it will follow you from job to job and stop the creation of unintended super accounts. You can read more about this here

 These steps form part of the Government’s bigger plan to see businesses and everyday Australians thriving again and to restore our economy. 

If you have questions about how the budget might affect your business or would like to arrange a Business Health Check, contact the team at Brandon and Gullo. 

Resources:
  • Income Tax Savings Calculator – https://www.abc.net.au/news/2020-10-06/budget-2020-income-tax-calculator/12732348
  • JobMaker – https://budget.gov.au/2020-21/content/jobmaker.htm
  • Superannuation – https://budget.gov.au/2020-21/content/factsheets/download/your_future_your_super_factsheet.pdf