2016 – 2017 tax rates

Individual

Resident Individuals – Rates 2015-2016

Taxable Income ($) Tax Payable ($)
0 – 18,200 Nil
18,201 – 37,000 19c for each $1 over $18,200
37,001 – 80,000* $3,572 + 32.5c for each $1 over $37,000
80,001 – 180,000 $17,547 + 37c for each $1 over $80,000
Over 180,001 $54,547 + 47c** for each $1 over $180,000

* The 2016 federal budget contains a proposal to expand the 32.5% band from $80,000 to $87,000.

** This includes the introduction of the 2% temporary Budget Repair Levy on income earners over $180,000. The levy will be imposed until 30 June 2017.
A tax offset of $445 is available to taxpayers with less than $37,000 taxable income. It phases out at $66,667.

Non-Resident Individuals – Rates 2015 – 2016

Taxable Income ($) Tax Payable ($)
0 – 80,000 32.5c for each $1
80,001 – 180,000 $26,000 + 37c for each $1 over $80,000
Over 180,001 $63,000 + 47c* for each $1 over $180,000

* This includes the introduction of the 2% temporary Budget Repair Levy on income earners over $180,000. The levy will be imposed until 30 June 2017.

Medicare Levy is 2% and is subject to low income thresholds. Non-residents are not required to pay the Medicare Levy. Medicare Levy Surcharge (MLS) applies unless taxpayers who do not have eligible private hospital cover for any part of the year. 

1% of income 1.25% of income 1.5% of income
Individuals >$90,000 >$105,000 >$141,000
Families >$180,000 >$210,000 >$280,000

Net Medical Expenses tax offset – limited
A tax offset is only available for net medical expenses that relate to disability aids, attendant care or aged care. 

Private Health Insurance Rebate
For the period 1 July 2016 to 31 March 2017, the private health insurance rebate will be based on income as follows:
Private Health Insurance Incentives Tiers (2016-2017)

Singles ≤ $90,000 $90,001-105,000 $105,001-140,000 ≥ $140,001
Families ≤ $180,000 $180,001-210,000 $210,001-280,000 ≥ $280,001
Rebate
< age 65 26.791% 17.861% 8.930% 0%
Age 65-69 31.256% 22.326% 13.395% 0%
Age 70+ 35.722% 26.791% 17.861% 0%

 

Business
Company Tax Rate
Companies with an aggregated annual turnover of $2 million or above will be subject to the general company tax rate of 30%.
The tax rate for Small Business companies is 28.5%. Small Businesses are those with aggregated turnover of less than $2 million. 

Unincorporated Business
A tax discount of 5% and capped at $1,000 per year is available to unincorporated small business entities, or who are partners in a partnership or beneficiaries of trust that are also small business entities. A small business entity is one that carries on a business with an aggregated turnover of less that $2 million.

Division 7A benchmark interest rate is 5.40%
FBT Statutory Benchmark Interest Rate 5.65%
Motor Vehicle Expense Deductions
Cents Per km Method 12% of Original Value Method Log Book Method
Eligibility Requirements None Car must be held
Expense base Business km’s travelled Multiply by 66 cents for each km Total vehicle expenses multiply by Business use percentage
Do you have to substantiate the expenses? No (reasonable estimate of business km travelled) Yes (written evidence of expenses)

– A maximum of 5,000 km can be claimed using the cents per km method.
– A log book must be kept for a continuous 12 week period, and can be used for 5 years.
– The motor vehicle depreciation cost limit is $57,581.

Asset Write Off For Small Business

Small businesses with aggregate annual turnover of less than $2 million can claim an immediate deduction for each depreciable asset that costs less than $20,000 (net of GST credits). This applies for assets first acquired from 7.30pm (AEST) 12 May 2015 and first used or installed ready for use on or before 30 June 2017.  Contact Gooding Partners for further information.

Superannuation
Tax on Superannuation Lump Sums
Lump Sum Withdrawals
(excluding death benefits and departing Australia superannuation payments)

Taxable Component
Age at Date of Payment Tax-free Component Taxed Element* Untaxed Element
Under preservation age Tax Free Total Amount 20% Amount up to $1,415,000: 30%
Excess: 45%
Preservation age to 59 Tax Free Amount up to first $195,000: 0% Amount up to first $195,000: 15%
Amount over $195,000 up to $1,415,000: 30%
Excess: 15% Excess: 45%
60 and over Tax Free Total Amount 0% Amount up to $1,415,000: 15%
Excess: 45%

*Rates exclude Medicare Levy and temporary Budget repair levy, where relevant.

Contributions Annual Caps

Contribution Type Aged 49 years or over as at 30 June 2015 Aged 48 years or under as at 30 June 2015
Concessional
– Employer: SG and salary sacrifice amounts
– Personal: amounts claimed as a tax deduction
$35,000 $30,000
Non-Concessional*
– Personal, after-tax
$180,000* $180,000*

*Members under the age of 65 can trigger the bring-forward rule which allows them to contribute up to $540,000 in non-concessional contributions during the financial year. But subject to the Federal Budget effective 3 May 2016, non-concessional contributions may be restricted to a lifetime cap of $500,000 measured from 1 July 2007. Draft legislation expected August 2016. Do not take any action without appropriate advice. 

Individuals with an Adjustable Taxable Income over $300,000 are liable to pay tax of 15% on their low tax contributions above the $300,000 threshold

Minimum % withdrawal – account based pensions

Age % Age %
55-64 4% 85-89 9%
65-74 5% 90-94 11%
75-79 6% 95 or more 14%
80-84 7%

Superannuation Guarantee rate for the 2016/2017 financial year is 9.5%
Eligible employees aged 70 years and over are entitled to Super Guarantee payments from their employers.
Individuals aged 70 to 74 years are also eligible to make voluntary employer contributions and non-concessional contributions, subject to meeting the work test requirements.
Individuals aged 75 and over are restricted to mandated employer contributions only.
Maximum Superannuation guarantee contributions base is
$51,620 per quarter.

If you would like to know how Gooding Partners can assist you with your tax, please call (08) 9327 1777 or email info@gpca.com.au