Post-Budget Reflections for Individuals and Families

The new budget that was handed down on 11 May has a great many provisions that will affect individuals and families. We will touch on a few here, but you are welcome to contact HY Accounting to discuss how they apply to your particular circumstances.

What does the budget mean to me and my family?

The budget means you and your family will very likely receive assistance to help you recover from the negative effects of the pandemic. In fact, there is a good possibility that you will be eligible for multiple types of assistance.

How will the budget impact me?

The budget will very likely have a positive impact on you because it is meant to benefit millions of Australians. It could be related to your housing, your job, your taxes, your health and more. Many people will actually see an impact in more than one area.

How can I benefit from the budget?

There are quite a few possible ways you might benefit from the new budget, depending on your individual circumstances. You may be eligible for tax cuts, housing subsidies, job training, employment assistance and much more.

Help me understand the budget in a language I understand

The new budget’s goal is to stimulate the economy in order to recover from the damage done by the pandemic. There is funding in place to help individuals, families and small businesses in a variety of different ways. Here are some of the most significant ones.

Taxes

LMITO, the low and middle-income tax offset, has been extended for another year. However, while it will benefit over 10 million Australians, it takes the form of reducing your tax bill instead of being deposited into your account.

Home ownership

There are multiple policies in the budget regarding home ownership:

Single parent subsidies: Starting 1 July, eligible single parents will be able to buy or build a new home with as little as 2% for a deposit and the government will guarantee 18% of the value of the loan on top of that.

First Home Loan Deposit Scheme: First-time home buyers are allowed to buy a freshly built home or build a new one, with a 5% deposit, while the government guarantees up to 15% of the loan.

First Home Super Saver Scheme: Eligible first home buyers can currently save up to $30,000 under this scheme, but the new budget will raise that to $50,000.

Childcare

There is $1.7 billion worth of childcare subsidies in the new budget, although they won’t start until July of next year. The cap will be removed from current subsidies and families with two or more children under five years old will see a substantial boost in their subsidies.

Superannuation

The minimum age for the current “downsizer scheme”, which allows anyone aged 65 or older to use up to $300,000 from the sale of their family home to boost their super savings, will be lowered to 60.

A completely separate measure will abolish the work test required for self-funded retirees between the ages of 67 and 74 to increase their super savings.

The budget policies will affect families and individuals differently, depending on the specifics of their situation. If you would like to know more about how you and your family might benefit, contact HY Accounting on 02 9837 6148 or send an email to enquiries@hyaccounting.com.au for the most accurate and up-to-date information.

Important:

These measures are not yet law and that the comments made in these articles may change depending on the legislation being passed. Liability limited by a scheme approved under Professional Standards Legislation. This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person or business. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.