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Recently we had the opportunity to speak with local small businesses at a Chamber of Commerce event about the importance of taking time out of our busy schedules to assess income and plan ahead for the financial year end.
Early preparation can help ensure that your accounts and tax position are in order before it’s too late.
Our latest newsletter brings you up to speed with recent budget announcements and ATO changes coming into effect soon that should be taken into account with your tax planning.
PERSONAL TAX CUTS
The 2025-26 Federal Budget confirmed a 1% reduction in the personal income tax rate for the $18,201-$45,000 bracket.
Starting 1 July 2026, the rate will drop from 16% to 15%, and further to 14% in 2027-28. This change could save taxpayers up to $268 in 2026-27 and $536 in 2027-28.
However, its implementation depends on the outcome of the Federal election on 3 May 2025 and subsequent budgets.
SUPER GUARANTEE RULES catch up with venues and gyms.
Employers are required to pay superannuation guarantee (SG) contributions for individuals defined as employees under SG rules, which has a broad interpretation.
This has led to debates about the rights of performers, gym instructors, and others not typically considered employees.
Employers must confirm their obligations if uncertain, either through legal advice or an ATO private ruling, as there is no time limit for the recovery of unpaid SG by the ATO. The SG system ensures adequate retirement support for employees and enforces compliance through strict laws and a complementary director penalty regime.
NON-COMPETE CLAUSE CHANGES
The 2025-26 Federal Budget proposes banning non-compete clauses for low and middle-income employees and consulting on their use for high-income earners (threshold $175,000).
This decision stems from an ABS report revealing widespread use of restraint clauses across businesses, with 46.9% surveyed employing such clauses, 20.8% using non-compete clauses for some staff, and 68.2% applying them to most employees.
Non-compete clauses are seen as detrimental to job mobility, wage growth, innovation, and productivity, which has declined in Australia over the past 20 years. Treasury highlights that these clauses hinder competition by discouraging worker movement, impeding new businesses and existing ones from expanding.
Find all the details here.
If you would like us to review your financial position for the year-to-date, we invite you to schedule a tax planning session with us. An hour or two of insight from our team could be one of the best investments you make this year.
Please feel free to contact us anytime if you’d like to explore or discuss any items in this months newsletter.
Kerrily and Louise – Directors
