May 10 2017
Federal Budget Update 2017-18
Key Federal Budget 2017 announcements that will impact Salary and Wage earners will include;
- First home buyers being able to access their super for a deposit
- The Medicare levy and
- Changes to the HELP repayment threshold
Here are some updates about these key points.
First home buyers accessing their super
From 1 July 2017, individuals can make voluntary contributions of up to $15,000 per year and $30,000 in total, to their superannuation account to purchase a first home. These contributions, which are taxed at 15 per cent, along with deemed earnings, can be withdrawn for a deposit. Withdrawals will be taxed at marginal tax rates less a 30 per cent offset and allowed from 1 July 2018.
As of 1st July 2019 the Medicare levy will be increased from 2% to 2.5%. Other tax rates tied to top personal income tax rate such as FBT and low income thresholds will also change.
New HELP repayment thresholds and rates to be introduced
The Government has lowered the thresholds to pay back HELP fees to accelerate repayment from 1st July 2018. The current minimum repayment threshold for the 2017/18 year is $55,874 with a repayment rate of 4%. This is set to decrease to $42,000 and 1% respectively. Conversely, the maximum band will be increased from the 2017/18 year threshold of $103,766 with a repayment rate of 8% to $119,882 and a repayment rate of 10%.