One of the announcements in the Budget was a proposal to means test the net medical expense tax offset. This offset is currently available to anyone who has unreimbursed medical expenses over $2,000 in a financial year, assessed as a family.
The proposals mean that the tax offset will no longer be available to anyone with adjusted taxable income over the Medicare Levy Surcharge threshold which is $84,000 for a single person or $168,000 for a couple or family. In addition, the offset will only be available for eligible medical expenses over $5,000 at the rate of 10% (down from 20%).
Eligible medical expenses include (but not limited to):
most aged care fees
doctor, dentist and optometrist fees
hospital fees
payment for therapeutic treatment administered at the direction of a doctor.
This change is proposed to take effect from 1 July 2012, so if possible, it would be advisable to bring forward any medical expenses if you are likely to exceed the current threshold of $2,000 in the current tax year.
Students who cannot afford to pay the university fees each year can accumulate the debt under the Higher Education Loan Program (HELP). Repayments are payable once their income exceeds a specified amount. The outstanding debt is indexed on 1 June each year.
Voluntary HELP payments can earn a discount to help reduce the debt. Parents looking for a Christmas gift for their children may wish to consider helping with the repayments.
Voluntary payments of $500 or more received by the ATO before 31 December 2011 will qualify for a 10% bonus. This reduces the debt by a further 10% of the voluntary repayment amount.
The ATO has launched a new Property webpage to provide practical guidance on the taxation aspects of property investment. This can help you understand the taxation impacts of your property investment.
The webpage includes information on the items below and can be found here:
Changes across tax, super and Centrelink were announced today as part of the Government’s Mid-Year Economic and Fiscal Outlook (MYEFO). With a need to find cost savings, some concessions have been cut and others deferred for another year.
A summary of new announcements is outlined below. These measures are proposals and legislation still needs to be introduced. (more…)
In the 2008-09 Budget, the Federal Government announced measures to reform income tests across the tax and transfer systems; these will come into effect from 1 July. This includes now taking into account items such as salary sacrifice superannuation contributions in benefit calculations. (more…)
