The Australian Government has announced that it will temporarily increase the instant asset write-off threshold to $20,000 for small businesses with an aggregated turnover of less than $10 million. This measure will be effective from 1 July 2023 until 30 June 2024 1. Small businesses will be able to immediately deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between 1 July 2023 and 30 June 2024. The $20,000 threshold will apply on a per asset basis, so small businesses can instantly write off multiple assets. Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool and depreciated at 15% in the first income year and 30% each income year after that 1.

Please note that this measure is not yet law and is currently before Parliament 1.

 

  • Low and Middle Income Tax Offset

  • The low and middle income tax offset (LMITO) ended on 30 June 2022. It is not available for the 2022–23 income year.

Working from home

The fixed rate method for calculating your deduction for working from home expenses has been revised. The revised fixed rate method is $0.67 per work hour and available from 1 July 2022.

The fixed rate method has been revised to:

  • increase the rate per work hour that you can claim when you work from home

  • change the expenses the rate covers

  • change the record keeping requirements

  • remove the requirement to have a home office set aside for work.

You can also separately claim a deduction for the work-related use of depreciating assets such as office furniture and technology.

If you don't use the revised fixed rate method, you need to use the actual cost method. You can no longer use the shortcut method.

These expenses are reported at question D5 of Individual Income Tax Return (IITR).

Removing the self-education expenses threshold

Before 1 July 2022, you were required to reduce your allowable work-related self-education expenses by $250 to calculate your deduction. The $250 non-deductible threshold has been removed from the 2022–23 income year. The changes will also apply to the fringe benefits tax (FBT) year starting on 1 April 2023.

Changes to Transfer Duty (previously known as Stamp Duty)

From July 1 the First Home Buyers Assistance Scheme has increased the Transfer Duty exemption amount from $650,000 to $800,000 with the concessions being increased from $800,001 up to $1,000,000. This means if you pay up to $800,000 for your first property and are an eligible First Home Buyer you will not be required to pay any Transfer Duty. If you purchase your first property between $800,001 to $1,000,000 you will receive a concession and will only be required to pay a portion of Transfer Duty.

These changes are now available to First Home Buyers.