Financial Budget 2022-2023

As you may know, the 2022 Federal Budget was recently announced. The level of interest in the 2022-23 Federal budget is extraordinary. The Treasurer was amazed at the resilience of the Australian economy and the pace of the economic rebound from a COVID-induced recession in 2020. Here are some of the main takeaways from this year’s budget. 

Employment levels are at record highs. The outlook has strengthened and output is now expected to have already exceeded its pre-pandemic level. The budget forecasts a more promising outlook predicting ‘a sustained period of strong economic growth, low unemployment, and rising wages growth.’

As the Australian economy moves beyond the immediate responses to the COVID-19 pandemic, further measures to support business were announced in this Federal Budget. Small businesses are key beneficiaries in this year’s Federal Budget with access to the Small Business Support Package providing mental health and financial support.

Technology investment boost

Small businesses will also be eligible for an additional 20 per cent deduction for the costs incurred from 7:30pm (AEDT) on 29 March 2022 (Budget night) until 30 June 2023 on business expenditure and purchases of depreciable assets that support their digital adoption.

Skills and training boost

To support small businesses train and upskill their employees, an additional 20 per cent deduction for expenditure will be available on external training courses provided. 

Small Business Support Package

The Small Business Support Package announced earlier this year will deliver initiatives supporting small business over three years from 2021-22 including:

  • $4.6 million to support the New Access for Small Business Owners program delivered by Beyond Blue to continue to provide free, accessible and tailored mental health support to small business owners 
  • $2.1 million to extend the Small Business Debt Helpline program operated by Financial Counselling Australia to provide financial counselling to small businesses
  • $10.4 million to enhance and redesign the Payment Times Reporting Portal and Register, and
  • $8.0 million to the Australian Small Business and Family Enterprise Ombudsman to enhance small business financial capability.

Tax compliance and integrity

Digitalising trust income reporting

The Budget confirms the Government’s previously announced intention to digitalise trust and beneficiary income reporting and processing.

It will allow all trust tax return filers the option to lodge income tax returns electronically, increasing pre-filling and automating ATO assurance processes. There are no other additional details in the Budget papers than in the earlier announcement.

The measure will commence from 1 July 2024 – “subject to advice from software providers about their capacity to deliver”.

The Government advises that it will consult with affected stakeholders, tax practitioners and digital service providers to finalise the policy scope, design and specifications.

Taxable payments data reporting: option to link to BAS cycle

The Budget confirms the Treasurer’s earlier announcement that businesses will be provided with the option to report taxable payments reporting system data on the same lodgment cycle as their activity statements, via accounting software. The rules for the taxable payments reporting system are contained in Subdiv 396-B of Sch 1 to the Taxation Administration Act 1953.

The Government will consult with affected stakeholders, tax practitioners and digital service 

providers to finalise the policy scope, design and specifications of the measure.

Subject to advice from software providers about their capacity to deliver, it is anticipated that systems will be in place by 31 December 2023, with the measure to commence on 1 January 2024.

Other major announcements: 

Cost of living package, payment, and tax offset

The total cost of the cost of living package is $8.6 billion.

Australians earning under $126,000 will receive an additional $420 tax offset in the 2021-22 financial year.

There will be a one-off tax-exempt cash payment of $250 for eligible pensioners, welfare recipients, veterans and concession cardholders.

Temporary fuel excise cut

A 50% cut to the rate of fuel excise, from 44.2 cents per litre to 22.1 cents per litre for six months.

Superannuation

The Government extended the 50 per cent reduction in the superannuation minimum drawdown requirements for a further year to 30 June 2023.

We are also experiencing the first sustained period of unemployment below 5% since before the GFC and only the second time since the early 1970s. Low unemployment is undoubtedly good news, but skills and labour force capability gaps are likely to be continuing challenges for businesses — and could be a drag on our capacity to deliver on the infrastructure initiatives flagged in the Budget.

Find this useful?

At Hopscotch Accounting, educating our clients on their budgetary needs is paramount to their success and ours. For more information on how this budget affects you and your business, please contact Hopscotch today at 1300 HOP 123.

Other News You May Like

Streamline Your EOFY

Streamline Your EOFY

End of Financial Year (EOFY) – it's not just a time for businesses to maximise tax deductions; it's a critical period...

Sign Up For Latest Updates, Articles & Resources