Small Business Tax Update: Tax Relief for Aussies
A Breakdown of the New Individual Tax Rates (Effective July 1, 2024)Â
The new financial year is upon us, and with it comes some welcome changes to Australian individual income tax rates. Here’s a quick and easy breakdown of what you need to know:
Good news! The Australian government is delivering tax cuts for every taxpayer starting July 1st, 2024. These changes are designed to offer some relief from the rising cost of living, particularly for middle-income earners.
Here’s what’s changing:
- Reduced Tax Rate for Low- and Middle-Income Earners:
- The tax rate for income between $18,200 and $45,000 has been slashed from 19% to 16%. This means you’ll keep more of your hard-earned cash.
- Higher Threshold for Higher Tax Brackets:
- The threshold at which the 37% tax rate applies has been increased from $120,000 to $135,000. This means you’ll pay the lower rate for a larger portion of your income.
- The threshold for the 45% tax rate has also been bumped up, from $180,000 to $190,000.
In simpler terms:
- If you earn between $18,200 and $45,000, you’ll pay 3% less tax on your income.
- If you fall into the $45,000 to $135,000 income bracket, you’ll benefit from the lower 30% tax rate for a larger chunk of your earnings.
Want to know how much you’ll save?
The Australian Taxation Office (ATO) website has a handy tax calculator tool  that can help you estimate your tax liability under the new rates. Check it out here: https://www.ato.gov.au/calculators-and-tools/tax-return-simple-tax-calculator
While these changes are positive, understanding your individual tax situation is crucial. We at Qbiztax can ensure you’re maximizing your deductions and filing your tax return accurately.Â
Overall, the new tax rates offer some well-deserved tax relief for most Australians. Let’s hope this helps ease the financial burden and keeps more money in your pocket!
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