tax & budget News: important things to know

upcoming deadlines!

I would like to take this opportunity to advise you on some important upcoming deadlines for:

1. The permanent closure of the Small Business Superannuation Clearing House (SBSCH). All employers using the SBSCH will need to make alternative arrangements for paying superannuation guarantee from 01/07/2026 such as using Xero. Please have this in place and working by the end of June to allow a smooth transition.

2. PayDay Super starts 01/07/2026 - New legislation now requires employers to pay superannuation guarantee on each and every payday at the same time as salary and wages are processed and paid. It is urgent to have your bookkeeping and payroll software updated and ready to comply before the end of June. This transition may affect your:

   * cash flow initially as payday super payments start on 01 July, and the June quarter superannuation is due to be paid by 28 July also.

   * payroll processes e.g., it is imperative to have a Tax File Number Declaration and an Employee Details Form from you new employees before they start work, including especially their superfund details.

3. Tax Returns due and overdue - some of you may already have personal tax returns overdue, some are not due till 05/06/26. If you would like to email me your paperwork I can try to complete your return before the end of May. My office will be closed for a large part of June for Professional Development.

BUDGET NEWS!

Here are some highlights of the Budget affecting the tax world, please call if you have any questions:

1. Capital Gains Tax reform - the 50% discount on sale of assets can still be used to 01/07/2027, after this, the old less lucrative Cost Base Indexation method will be used.

2. Negative Gearing

   * Existing rules apply for those entered into a contract to buy before 12 May 2026.

   * There will be a transition period for those purchasing between 12 May 2026 and 1 July 2027 meaning the existing rules will apply for this period only.

   Negative gearing no longer allowed for purchases after 01 July 2027. Unless for new builds, commercial properties, SMSF Properties, projects that increase housing supply. * Any Carried Forward losses can be used against future income/gains.

3. The original tax cuts are going ahead, as small as they may be! The current 16% tax rate will reduce to 15% from 01/07/2026, and then will reduce to 14% from 01/07/2027.

4. There will be a standard $1000 work-related expenses deduction available from 01/07/2026. No details are known yet. It is being said that worker tax payers will not need to substantiate or itemise these expenses to claim them, however, there is always a catch so watch this space.

5. Taxation of Trusts - trustees will pay a minimum tax of 30% on taxable income of discretionary trusts from 01/07/2028. Beneficiaries, other than corporate beneficiaries will receive non-refundable credits for the tax payable by the trustee. This timeline allows us to put measures into place beforehand to avoid any anticipated issues.

6. The Medicare levy low-income thresholds are increasing effective from 01/07/2025.

7. Private Health Insurance Rebate - the Government will remove the age-based uplift of the Rebate from 01/04/2027. Currently, individuals aged 65 and above are entitled to a higher rebate percentage.

8. The $20,000 instant asset write-off has been made permanent effective from 01/07/2026.

   
   

I hope you've found this interesting and helpful, if you have any questions or are concerned about anything. We don't have a lot of detail on the changes as yet, however please don't hesitate to contact me.