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2019 Budget

In the aftermath of Tuesday night's Federal Budget, we take the opportunity to revisit some of the proposed changes that were handed down.

But of course, as with any budget, all proposed reforms will still need to be passed before they become legislation and with a federal election in the not-too-distant future, the Liberal party will need to maintain a majority to see their legislation come into effect.
Instant Asset Write-Off Threshold
Possibly, the largest and most mediate change was the increase to the instant asset write-off threshold from $25,000 ($20,000 up to 28 January, 2019) to $30,000 per asset until 30 June, 2020. The increased threshold and expanded eligibility will apply to eligible assets that are first used, or installed ready for use, from 2 April 2019 to 30 June 2020.

Asset first used or installed ready for use between

Small business (turnover less than $10m)

Medium business (turnover less than $50m)

Large business (turnover $50m or more)

1 July 2018 to 28 January 2019

< $20,000



29 January 2019 to Budget night(Proposed)

< $25,000



Budget night to 30 June 2020

< $30,000

< $30,000


Eligibility for the scheme has been expanded from small businesses (up to $10 million in annual turnover) to medium-sized ones (up to $50 million).

Medium sized businesses do not have access to the small business pooling rules and will instead continue to depreciate assets costing $30,000 or more (which cannot be immediately deducted) in accordance with the existing depreciating asset provisions in the tax law i.e. Table A and Table B.

The Budget at a glance
A brief look at other titbits announced on the night:
  • The Tax rate for small and medium-sized companies with an annual turnover of less than $50 million has been lowered to 27.5 per cent. This rate will be lowered further to 25 per cent by 2021-22.
  • In addition to existing incentives for Identified Skills Shortages, employers will be eligible for a $4,000 incentive payment totalling to $8,000. Apprentices will be eligible for $2,000, paid at key milestones in the apprenticeship.
  • There will be a one-off Energy Assistance Payment (Income Tax Exempt) of $75 for singles and $62.50 for each member of a couple eligible for qualifying payments on 2 April 2019 and who are resident in Australia.
  • The Medicare levy low-income thresholds for singles, families, seniors and pensioners will be increased from the 2018/19 income year.
  • The start date of amendments to Div 7A will be delayed by 12 months to 1 July 2020.
  • For vehicles acquired on or after 1 July 2019, eligible primary producers and tourism operators will be able to apply for a refund of any luxury car tax paid, up to a maximum of $10,000.
  • From 1 July 2019, net income generated from the forced sale of livestock will be exempted from the Farm Household Allowance payment assessment, when that income is invested into a farm management deposit.
Still have some questions? Your team at Pursuit Advisers are here to help!
Please do not hesitate to contact us on (03) 5623 3778

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