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Tax Laws Amendment (2009 Measures No 2) Bill 2009 On 19 March 2009, the Federal Government introduced Tax Laws Amendment (2009 Measures No 2) Bill 2009 into the House of Representatives. Broadly, the Bill seeks to:
A discussion of the amendments follows. Taxation implications and financial claims scheme entitlement The Bill will amend various Acts to ensure there are no adverse tax implications arising from a payment made by APRA, or by a liquidator under the financial claims scheme (FCS). This will be achieved, in general, by treating payments made under the FCS in the same way as if they had been made by the failed financial institution or insurer to which the FCS applies. The amendments are proposed to:
CGT amendments The Bill will amend the CGT provisions to disregard a capital gain or loss arising from an entitlement under the FCS in relation to an authorised deposit-taking institution (ADI) deposit or a general insurance policy. Generally, there are two rights arising from the FCS in relation to ADI deposits to which the CGT rules can apply:
Where the FCS covers only part of an ADI deposit, a payment made under the scheme will result in a partial disposal of the ADI deposit. The Bill specifies that the cost base of the part of a deposit which is covered by the scheme is equal to the payment under the scheme. The cost base of the remainder of a deposit following a payment from the scheme is equal to the cost base of the deposit reduced by the amount that has been paid under the scheme. The amendments to disregard capital gains or capital losses in respect of ADI deposits or general insurance policies apply to CGT events after the commencement of the scheme on 17 October 2008. This seeks to ensure that the CGT rules can apply immediately if the scheme is activated. Farm management deposits The Bill proposes to amend Sch 2G of ITAA 1936 to ensure there are no adverse tax implications for holders of FMDs arising from the scheme where FMDs are held with failed ADIs. The measure also covers the actions of both APRA and the liquidators of failed ADIs. The Bill will also provide that the establishment of a new FMD by APRA will not result in a withdrawal of the original FMD and the making of a new FMD for tax purposes. The establishment of a new FMD will instead be treated as a transfer of the old FMD. Similarly, the establishment of a new FMD by a liquidator will be treated as a transfer of the old FMD for tax purposes. Retirement saving accounts A payment by APRA of an individual’s RSA scheme entitlement in a failed ADI will be treated as a rollover superannuation benefit from the failed ADI. First home saver accounts The Bill will make consequential amendments to the eligibility and administration of FHSAs under the First Home Saver Accounts Act 2008. If an ADI fails, APRA or the liquidator will be empowered to open an FHSA in another ADI and transfer the funds guaranteed by the scheme into the new FHSA for the affected person. Reporting obligations The Bill will require APRA to report, in an annual statement to account-holders and recipients, all amounts paid to, or applied to the benefit of, account-holders and recipients under the scheme in a financial year. APRA is also required to report these details to the Commissioner in an annual report within four months after the end of the financial year in which the payments are made. In this respect, APRA will be required to provide TFN information to the Commissioner that would have otherwise been provided by the investment body under reg 56 of the Income Tax Regulations 1936. PAYG withholding The Bill will insert a new Div 21 in Sch 1 to the Taxation Administration Act 1953 to ensure that the PAYG withholding provisions apply to payments under the FCS in a manner corresponding to the way they would apply if the payment had been made by an ADI or general insurance company. Consequently, APRA as the administrator of the FCS is required to withhold amounts from payments made under the scheme and then report and remit these amounts to the Commissioner. Date of effect The amendments will commence on the date the Bill receives Royal Assent. However, the amendments apply to all payments made, and other actions carried out, under the scheme, whether before or after the amendments commence. Small business CGT concessions The Bill will increase access to the small business CGT concessions for a taxpayer owning a CGT asset used in a business by the taxpayer’s affiliate or entity connected with the taxpayer via the $2 million aggregated turnover test (the small business entity test). It will also allow for partners owning a CGT asset used in the partnership business to access the concessions via the small business entity test where the CGT asset is not an ‘asset of the partnership’. Further, it will make a number of minor amendments to clarify and refine elements of the small business CGT concessions. Main amendments Broadly, the main amendments will increase access to the small business CGT concessions for taxpayers (including partners in a partnership) that hold passive CGT assets. Partnerships and passively held CGT assets Basic requirements Currently, a strict interpretation of s 152-10(c)(iii) of ITAA 1997 means that partners in a partnership seeking to access the small business CGT concessions via the small business entity test may be ineligible. This is because the subsection requires the CGT asset to be ‘an asset of the partnership’. Therefore, the Bill will clarify the law and align it with the intended operation of the provision. This will be achieved by inserting the words ‘interest in an’ into the subsection as follows:
Indirect ownership in a CGT asset The Bill will insert a new provision specifying rules to access the small business CGT concessions via the small business entity test for CGT assets, owned by partners, in which the partnership does not hold an interest, that are used in the business of the partnership, provided the assets are made available for use in the partnership. That is, the partners do not own the CGT assets in accordance with their fractional interest in the partnership or in accordance with their respective interests as specified in the partnership agreement. A taxpayer who satisfies the following conditions contained in the new s 152-10(1B) will be able to access the concession:
Where an asset is an interest in an asset of a partnership, a taxpayer will not be able to utilise the above concession. Rather, its eligibility for the small business CGT concessions will be determined via the small business entity test contained in s 152-10(1)(c)(iii). It is important to note that, while the partnership will calculate its aggregated turnover under the requirements contained in Div 328 of ITAA 1997 for the purposes of determining whether it is a small business entity, the calculation method will be modified by the new s 152-48 of ITAA 1997 (see Aggregated turnover calculation and passively held CGT assets on page 5). The Explanatory Memorandum accompanying the Bill provides the following example:
Passively held CGT assets (other than partnerships) Currently, if a taxpayer owns a CGT asset and does not carry on a business, the taxpayer cannot access the small business CGT concessions via the small business entity test, even if the asset is used in the business of an affiliate or a connected entity that is a small business entity. The Bill will insert new s 152-10(1A) into ITAA 1997 to ensure that, where a taxpayer who owns a CGT asset (and does not carry on a business other than as a partner in a partnership) that is used in a business by the taxpayer’s affiliate or a connected entity, the taxpayer can access the small business CGT concessions provided the following conditions are satisfied:
If an asset-owning entity is seeking access to the small business CGT concessions via the proposed amendments, the rules contained in s 328-115 of ITAA 1997 for determining the aggregated turnover of the relevant business are modified by the new special rules for calculating aggregated turnover for passively held assets (see Aggregated turnover calculation and passively held CGT assets on page 5). The proposed amendment is only available if a taxpayer who owns the CGT asset, which is used in the business of its affiliate or an entity connected with the taxpayer, is not carrying on a business except as a partner in a partnership. Where the taxpayer is also carrying on a business other than in a partnership, the taxpayer would continue to determine its eligibility for the small business CGT concessions via the small business entity test under s 152-10(1)(c)(i) of ITAA 1997. The Explanatory Memorandum accompanying the Bill provides the following example:
Affiliates and passively held CGT assets Currently, s 152-40(1A) of ITAA 1997 does not treat a CGT asset as active if an individual owns the asset and it is used in a business directly carried on by the individual’s spouse or children (under 18 years of age). That is, the individual would have to rely on an entity being an affiliate of the individual to treat the asset as being active, which may be difficult to establish. The Bill proposes to repeal this subsection and replace it with a new s 152-47. The new section will treat an individual’s spouse or children as an affiliate for the purposes of determining whether the individual (or an entity the individual has an interest in or is a beneficiary of) is eligible for the small business CGT concessions where one entity owns a CGT asset and:
Other points to note about the operation of the new affiliate rule are:
In addition, under the amendments an entity that operates a business and owns a CGT asset that is used in the business of another entity will also be able to access the small business concessions via the $2 million turnover test. This could occur where the asset-owning entity is wholly owned by an individual, the entity using the asset in its business is wholly owned by the individual’s spouse and the asset-owning entity and business entity are not affiliated and are not connected with each other. The Explanatory Memorandum accompanying the Bill explains that the new rule is applied in two stages. The first stage will treat an individual’s spouse or child as his or her affiliate. If the conditions of the first stage are met, the second stage will apply to treat the spouse or child as an affiliate of the individual for the purposes of Subdiv 152-A of ITAA 1997 and ss 328-110 to 328-125 of ITAA 1997 (to the extent that these sections relate to Subdiv 152-A). Aggregated turnover calculation and passively held CGT assets The Bill proposes to insert rules for calculating aggregated turnover for passively held assets that apply in addition to the standard aggregated turnover rules in Subdiv 328-C of ITAA 1997. For these purposes, a special rule treats an entity (the deemed entity) that is an affiliate of, or is connected with, the owner of a passively held CGT asset as an affiliate of, or connected with, the entity that uses the passively held asset in its business (the test entity) if the deemed entity is not already an affiliate of, or connected with, the test entity. Businesses that are winding up The Bill will provide comparable access to the small business concessions for owners of passively held assets, the amendments insert a new rule that permits the CGT event to occur in an income year after the business has ceased operating but while it is being wound up. The new rule applies to an entity that previously carried on a business which is being wound up in the CGT event year but only if the asset had been used, held ready for use, or was inherently connected with the business in the income year it ceased to operate. Date of effect The main amendments will apply to CGT events happening in the 2007/08 income year and later income years. Other amendments Net asset test Currently, s 152-20(2)(a) of ITAA 1997 disregards the value of interests in entities connected with a taxpayer or the taxpayer’s affiliates to avoid double counting in the net assets calculation. However, this excludes the liabilities relating to such disregarded interests so that such liabilities are never taken into account in the net asset value calculation. Consequently, this disadvantages taxpayers because it excludes liabilities that are indirectly related to assets whose gross values have been included in the net asset calculation. The Bill will provide that liabilities relating to disregarded interests in entities connected with a taxpayer or the taxpayer’s affiliates are taken into accounting when calculating the net asset value. The Explanatory Memorandum accompanying the Bill provides the following example:
The amendment will apply to CGT events that happen on or after the day on which the amending legislation receives Royal Assent. Assets mainly used to derive rent The Bill will amend the active asset test contained in s 152-40 of ITAA 1997 to ensure that all the uses of an asset (apart from personal use of the asset by a taxpayer or an affiliate of the taxpayer) are considered in determining whether it is an active asset for the purpose of the small business CGT concessions. Under the current law, it is possible for an asset which has a predominant rental and a minor business use to qualify as an active asset if the minor business use is undertaken by an affiliate or an entity connected with the taxpayer, but the rental use is by an entity that is neither an affiliate of, nor connected with, the taxpayer owning the asset. The amendments will adopt an attribution approach in relation to the use of an asset by a taxpayer’s affiliate or an entity connected with the taxpayer, including any personal use. This approach treats the use of the asset by the affiliate or the entity connected with the taxpayer as though it was the use of the taxpayer. As a result, if the affiliate or entity connected with the taxpayer uses the asset to derive interest, rent, royalty or foreign exchange gains from an entity that is neither an affiliate of nor connected with the taxpayer, that use is treated as the taxpayer’s use. The amendments will apply to CGT events that happen on or after the day on which the Bill receives Royal Assent. Joint tenants and testamentary trusts The Bill will extend access to the small business CGT concessions under s 152-80 of ITAA 1997 to capital gains relating to assets acquired on the death of a joint tenant and to assets that devolve to the trustee of a trust that is established by the will of an individual where the deceased would have been able to access the concessions. The amendments will ensure that the concessions are not denied simply because of the death of a joint tenant and the automatic transfer of the asset to the other tenant (rather than going through an estate) where the surviving tenant does not continue with the business. Similarly, the amendments will ensure that the concessions are not denied simply because, following the death of an individual, an asset devolves to the trustee of a testamentary trust established by the will of the deceased individual. The amendments apply to CGT events that happen in the 2006/07 income year and later income years. Retirement exemption Capital proceeds received in instalments The Bill will insert a rule to apply the retirement exemption available under the small business CGT concessions to capital proceeds received in instalments by individuals. The Bill will also remove the duplicate provision contained in s 152-310(3) of ITAA 1997 for receipt of capital proceeds in instalments by companies and trusts. The amendment relating to capital proceeds received by individuals will apply from the 2007/08 income year and later income years. The amendment relating to capital proceeds received by companies and trusts will apply to payments made on or after the day on which the Bill receives Royal Assent. CGT events J5 and J6 Currently, the retirement exemption is not available for CGT events J5 and J6 because capital gains arising from those events do not satisfy the basic conditions prescribed by ss 152-305(1)(a) and 152-305(2)(a) of ITAA 1997. The Bill will insert a new provision to modify the operation of those sections to make satisfying the basic conditions for the retirement exemption unnecessary if a capital gain arises from CGT event J5 or J6. The Explanatory Memorandum accompanying the Bill provides the following example:
The amendment will apply to CGT events that happen in the 2006/07 income year and later income years. Payments to CGT concession stakeholders through interposed entities The Bill will allow a company or a trust to make a retirement exemption payment indirectly through one or more interposed entities to a CGT concession stakeholder. It will also provide that an indirect payment made through an interposed entity is:
The Bill will ensure that retirement exemption payments made pursuant to s 152-325 of ITAA 1997 are excluded from the operation of Div 7A and s 109 of ITAA 1936. It will also remove the requirement that a payment made by a company or a trust to an employee for an amount exempted under the retirement exemption be treated as a payment made in respect of the termination of employment of the relevant CGT concession stakeholder. The amendments will apply to payments made on or after the day on which the Bill receives Royal Assent. Partners and small business entities The Bill will amend the definition of a small business entity contained in s 328-110 of ITAA 1997 to provide that a partner in a partnership cannot be a small business entity in his or her capacity as a partner. It is important to note that this amendment applies to all the concessions available to a small business entity and not just for the small business CGT concessions. The amendment will apply from the 2007/08 income year and later income years. Tax benefits and CGT The Bill proposes a general exemption from CGT for capital gains or losses arising from a right or entitlement to a tax offset, deduction or similar benefit. Examples of when this exemption will apply include:
The amendment will apply to relevant CGT events happening in the 2009/10 income year and later income years. Urban water tax offset The Bill will amend ITAA 1997 to provide a refundable tax offset in relation to certain projects approved under the National Urban Water and Desalination Plan. If an applicant is outside the tax system, the applicant will receive a grant. Financial assistance is capped at 10% of eligible up-front capital costs up to a maximum of $100 million per project. In addition, projects must have eligible capital costs of at least $30 million. Special rules apply to stormwater harvesting projects such that the amount of the offset is up to 50% of eligible capital costs to a maximum of $20 million. A company becomes entitled to a refundable tax offset if the Minister for Climate Change and Water issues a valid certificate. The amount may be paid over several certificates, coinciding with attaining project milestones, and therefore relate to different income years. Financial assistance will be of a fixed value once it has been approved, regardless of any subsequent changes to the capital cost of the project. If a certificate is revoked, the certificate will be treated as though it was never issued, and the relevant tax return of the company will need to be amended. The Bill will also allow a company to apply to the AAT for review of the Minister’s decision in relation to:
The review rights apply only to the process surrounding the issuance and revoking of certificates, and not the application for assistance. The Bill also contains a number of consequential amendments to include the tax offset in various parts of ITAA 1997, including amendments to provide a general exemption from CGT for capital gains arising from a right or entitlement to a tax offset, deduction or similar benefit. Date of effect The measure applies to approved projects between the 2009/10 and 2012/13 income years. Condition for fuel tax credits The Bill will remove the restriction that a business may not claim more than $3 million of fuel tax credits in an income year unless they are a member of the Greenhouse Challenge Plus Programme (GCPP), or another program determined by the Minister for the Environment, Heritage and the Arts. This will be achieved by repealing Div 45 of the Fuel Tax Act 2006. From 1 July 2009, businesses will not be able to join the GCPP. However, a consequential amendment will enable the businesses to make a decreasing adjustment for credits prior to 1 July 2009. This will be achieved by deeming a business that is not a member of the CGPP to be a member immediately prior to the CGPP termination. The amendments will apply to the 2008/09 income year and later income years. Tax exemption for certain grants The Bill will exempt from income tax the Clean-up and Restoration Grants paid to small businesses and primary producers affected by the Victorian bushfires. That is, the payments will be non-assessable non-exempt income. The exemption will apply to grants paid in the 2008/09 and 2009/10 income years. Self-education Deductions The Federal Court has held that a taxpayer who was receiving the Youth Allowance was entitled to a deduction for self-education expenses: Anstis v FCT [2009] FCA 286. Background For the income year ended 30 June 2006, the taxpayer was enrolled as a full-time student studying a teaching degree. In her tax return of that income year, she reported wages earned as a party-time sales assistant and the Youth Allowance. She did not declare any income from having worked as a teacher. However, the taxpayer claimed a deduction for self-education expenses. The expenses were described as ‘travel expenses other than to university’, ‘supplies for children during teacher rounds’, ‘student administration fee’, ‘depreciation — computer’, ‘textbooks and stationery’. The Commissioner disallowed the deduction for self-education expenses and issued an assessment which increased the taxpayer’s assessable income. The taxpayer objected to the Commissioner’s decision. However, the Commissioner disallowed the taxpayer’s objection. As a result, the taxpayer made an application to the AAT for a review of the Commissioner’s decision. The taxpayer contended that she was entitled to the deduction because the expenses were incurred in gaining her assessable income (ie the Youth Allowance). At first instance, the Tribunal affirmed the Commissioner’s decision to disallow the deduction. This was because the Tribunal found that the derivation of the Youth Allowance did not have the necessary nexus with the expenditure incurred. Subsequently, the taxpayer appealed to the Federal Court. The taxpayer argued that she was entitled to the deduction as the expenditure had been incurred to meet the requirements for her to receive assessable income, ie the Youth Allowance. She submitted that in order to be entitled to the Youth Allowance, she was required to be enrolled, and to be making satisfactory progress, in full-time study, and therefore, the costs incurred in the course of her study were deductible as having been incurred in gaining that income. Broadly, the Commissioner contended that the essential character of the expenditure was for the purpose of gaining future employment as a teacher, and lacked the necessary connection to the Youth Allowance income. That is, the expenditure had been incurred to enable the taxpayer to obtain new employment and was ‘at a point too soon’ to be regarded as having been incurred in gaining or producing assessable income. Decision The court stated that the salient issue was whether the taxpayer was entitled, as a recipient of the Youth Allowance, to deduct from her income the costs incurred in the course of her study. The logic indicated by the court was that, as the Allowance was assessable income under s 6-5 of ITAA 1997, it follows that a deduction is allowable if expenditure was incurred in deriving that income under s 8-1 of ITAA 1997. The court found the expenditure was incurred in gaining or producing the Youth Allowance within the meaning of s 8-1 as the various eligibility and qualifying requirements for the Allowance can only be satisfied by the expenditure of money. It said, ‘that the taxpayer’s ultimate purpose or motivate in undertaking the course was to acquire a qualification leading to future employment as teacher is irrelevant to the characterisation of the expenditure’. Rather, the court’s opinion was that it was sufficient the expenditure was incurred as a necessary incident of deriving the Allowance. The court rejected the Commissioner’s contention that the self-education expenses were incurred at ‘a point too soon’ This was because the expenditure was incurred in the same tax year as, or otherwise close in time to, the receipt of the Allowance. Accordingly, the court allowed the appeal and set aside the Tribunal’s decision. The court also remitted the amended assessment to the Commissioner to revise the assessment in accordance with the court’s decision. At the time of publication, the Commissioner has not indicated whether he will be appealing the Federal Court’s decision. Deductibility of self-education expenses If allowed to stand, the decision in Anstis may oblige the Commissioner to change his long-standing Taxation Ruling on self-education expenses. In Taxation Ruling TR 98/9, the Tax Office states its view regarding the deductibility of self-education expenses against the following Commonwealth educational assistance schemes payments:
According to the ruling, self-education expenses incurred by recipients of the above payments are not deductible because the expenses are not incidental and relevant to the educational assistance payments. The Commissioner’s view is that the expenses incurred in fulfilling a course requirement are characterised as expenses incurred in undertaking study that might enable a recipient to obtain employment in a particular field. It is important to note that the ruling does not specifically address the deductibility of self-education expenses in relation to other education assistance schemes. Where an individual receives other payments (eg Youth Allowance), it states that the principles of deductibility need to be considered on a case-by-case basis. However, it states that, generally, ‘self-education expenses are not deductible where the scheme provides payments in the nature of assistance’. [Emphasis added.] The Commissioner’s established view is that self-education expenses are, generally, deductible where the expenses have a relevant connection to a taxpayer’s current income-earning activities. That is, if:
However, a deduction for self-education expenses is not allowable if the expenses are to obtain new employment or to open up a new income-earning activity (whether in business or in a taxpayer’s current employment). This is because the Commissioner considers the expenses are incurred at a ‘point too soon’ to be regarded as incurred in gaining or producing assessable income. Taxpayer Alert — Superannuation The Tax Office has released Taxpayer Alert TA 2009/8, in which it describes arrangements that involve the transfer of benefits associated with the 1999 ‘transitional provisions’ for self-managed superannuation funds (SMSFs) with pre-existing interests in unit trusts. The Tax Office says that the Alert applies to arrangements with features substantially equivalent to the following:
Regulatory issues The Tax Office considers that arrangements of the type described above involve superannuation regulatory issues including whether:
The Tax Office also considers that the arrangements involve taxation issues including whether:
Legal status of a Taxpayer Alert A Taxpayer Alert is only intended to be an ‘early warning’ of a tax planning arrangement that the Tax Office has under risk assessment. However, it is expected that a ruling or determination will be issued by the Tax Office following the release of the alert. Taxpayers who have entered into or are contemplating entering into an arrangement similar to that described in the alert may contact the Tax Office to seek guidance in relation to the income tax and superannuation regulatory issues covered in the alert. In-house assets transitional provisions Under the in-house assets rule contained in Pt 8 of SISA, a regulated superannuation fund is, generally, restricted from having more than 5% of the total market value of its assets invested in in-house assets. However, ss 71A to 71F provide transitional arrangements in relation to in-house assets acquired before 11 August 1999. These transitional arrangements include:
PAYG Instalment Reduction In a joint media release issued by the Treasurer and the Minister for Small Business, Independent Contractors and the Service Economy, they announced that the Government will cut the quarterly PAYG instalments for the 2009/10 income year for taxpayers who calculate their quarterly instalment using the gross domestic product (GDP) adjusted notional tax method. The media release stated that business owners who pay their GST quarterly will also benefit from the proposed measure. The Commissioner has advised that a 2% adjustment factor will be used when calculating GST instalments for eligible business owners. The proposed measure will not apply to taxpayers who calculate their instalments using the instalment rate notified by the Tax Office. The media release stated that the Government will use the expected increase in the consumer price index (CPI) for 2009/10 to calculate the tax instalments for taxpayers. It also stated that ‘for the 2009/10 income year, the Government has reduced the GDP adjustment from 9% to 2%, aligning it with the expected CPI growth of 2% for 2009/10, as forecast in the Updated Economic and Fiscal Outlook’. At the time of publication, the Government has not released further details or implemented any regulations to give effect to the proposed measure. Data Matching Projects The Tax Office has released details of three data matching projects which it will carry out. The projects are discussed below. Motor vehicle data matching The Tax Office has announced that it will request and collect details of individuals or entities that have purchased or acquired a motor vehicle valued at $10,000 or higher from the following state and territory departments:
According to the Tax Office, records relating to approximately 2.5 million individuals will be matched. These details will be electronically matched with certain sections of its data holdings to identify non-compliance with lodgment and payment obligations. Personal services income data matching The Tax Office has also announced that it will request and collect information on amounts paid to personal services entities from the following labour hire firms, placement agencies and computer consultancies:
The information being sought will include:
The Tax Office says that the information collected will be electronically matched with certain sections of its data holding to identify non compliance with lodgment and payment obligations. It also says that records relating to approximately 30,000 individuals and entities will be matched. Payments received from mining companies The Tax Office has also announced that it will request and collect information on amounts paid by mining companies to contractors and sub-contractors. The data to be requested will also include name and address details of the individual who is the main service provider to an entity. The information will be sourced from the following mining companies:
The Tax Office has stated that records relating to approximately 10,000 individuals and entities who have received contract payments from the above listed mining companies will be electronically matched with certain sections of its data holdings to identify non-compliance with lodgment and payment obligations under taxation law. Superannuation Rates and Thresholds 2009/10 The Tax Office has released the key superannuation rates and thresholds for 2009/10, which include the superannuation contributions caps and employment termination payments caps. Contributions caps
1. A transitional contribution cap of $100,000 per annum applies until 30 June 2012 for individuals between 50 and 74. 2. Individuals under age 65 may bring forward the non-concessional cap for the next two years. Employment termination payments
1. The upper cap amount is not indexed. Reminder: Individual Tax Rates from 1 July 2009 The resident individual tax rates will change from 1 July 2009. The new rates applicable for the 2009/10 income year are set out below with the changes in bold.
The foreign resident individual tax rates will change from 1 July 2009. The new rates applicable for the 2009/10 income year are set out below with the changes in bold.
The foreign resident individual tax rates will change from 1 July 2009. The new rates applicable for the 2009/10 income year are set out below with the changes in bold.
Low-income tax offset The maximum amount of the low-income tax offset and the phase-out limit will increase from 1 July 2009. For the 2009/10 income year, the maximum amount of offset is $1,350 (increased from $1,200 for the 2008/09 income year). The phase-out limit for the 2009/10 income year is $63,750 (increased from $60,000 for the 2008/09 income year).
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