Budget 2019: Will I pay less tax?
Changes to tax brackets explained.
Tax rates and tax offsets are being lowered. The Budget papers estimate this will impact around 4.5 million Australians in the current financial year.
Who will this affect?
If you earn under $126,000, the tax offset will lower the amount of tax you have to pay, beginning with the 2018-2019 financial year. The maximum amount it will be lowered is $1,080 per person. The table below shows the amount of offset applying to different incomes.
|Up to $37,000||Up to $255|
|$37,001-$47,999||From $255 to $1,080|
|$90,001-$126,000||Reduces from $1,080 to $0 depending on income|
When will the changes happen?
The immediate change won't apply until you submit your tax return for the 2018-2019 financial year.
Further adjustments are planned in the future. For instance, from 1 July 2024, the government plans to cut the rate for taxpayers earning between $45,000 and $200,000 a year from 32% to 30%. However, as that's five years away, I wouldn't be making detailed investment plans based on it definitely happening.
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