The federal budget is full of one-off cash payments and tax benefits. Here’s a run down of some of the key points.


Low-and Middle-Income Tax Offset (LMITO)

The ‘cost of living’ tax offset for middle-income earners will be increased by $420 to a maximum of $1,500 for the 2022 financial year (up from $1,080).  Importantly the Government did not announce an extension beyond 2022 when it’s currently legislated to end.


$250 ‘Cost of Living’ Payment

The Government will make a one-off cost of living payment in April 2022 to eligible pensioners, welfare recipients, veterans, and concession card holders.


Personal Tax Rates

There has been no change to the personal tax rates for the 2023 financial year.  The stage 3 personal income tax cuts, which mostly benefit high-income earners, remains unchanged and will commence in 2025 financial year as already legislated.


PAYG Instalment Options

From 1 January 2024, companies will be allowed to choose to have their PAYG Instalments calculated based on the current financial performance, extracted from business accounting software.


Small Business 20% Deduction Boost for Digital Adoption & Skills Training

Small businesses with a turnover of less than $50 million will receive a 20% uplift on deductions for eligible expenditure incurred from 7.30pm on 29 March 2022 until 30 June 2024 for skills training, and 30 June 2023 for digital adoption.


Superannuation Guarantee Rate

The Budget did not contain any change to the legislated Superannuation Guarantee rate rise from 10 percent to 10.5 percent for the 2023 financial year.


COVID-19 Test Expenses to be Deductible

The Budget papers confirm that the cost of taking a COVID-19 test to attend a place of work is deductible from 1 July 2021.  In making these costs deductible, the Government will also ensure FBT will not be incurred by the business were COVID-19 test are provided to employees for this purpose.


Temporary Reduction in Fuel Excise

The Government will reduce the excise that applies to petrol and diesel for six months by fifty percent (44.2 cents per litre to 22.1 cents per litre).  This started from midnight on Budget night.


More COVID-19 Business Grants Designated Non-Assessable Non-Exempt Income

The Government has extended the measure which enables payments from certain State and Territory COVID-19 business support programs to be made non-assessable non-exempt (NANE) for income tax purposes until 30 June 2022.


Paid Parental Leave Scheme

A single Paid Parental Leave scheme of up to 20 weeks paid leave will replace the existing system of two separate payments.


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