All The Financial New Year Changes Starting Tomorrow That You Need To Know About

financial year tax cuts

With July just around the corner (and by around the corner, I mean literally in JUST A FEW HOURS), it’s nearly the new financial year – so I hope you’ve bought all the exxy stuff you want to claim as WFH, because the count down to tax time is on.

Taxes aren’t the only thing you need to be on top of this financial year though – there’s a whole bunch of laws going to effect from tomorrow. So here’s your quick little explainer on the important bits that’ll matter most to you.

Tax cuts, baby

There are a whole bunch of tax-related changes coming with the new financial year. For starters, the Parliament passed a $1080 tax cut earlier this month – but don’t get tooo excited. Contrary to some misinformed tweets I’ve seen online, this doesn’t mean you are getting an extra $1080 with your tax refund – it just means that some people can get up to $1080 reduced off the tax they’re *already* paying.

“Basically, if your income is less than $37,000, you will receive $255. If your income is between $37,001 and $48,000, the tax offset will increase steadily to $1080,” Mark Chapman, director of tax communications at H&R Block, told news.com.au.

It’s a way to reduce the taxes you pay – it’s not cash lining your pockets, sadly.

It’ll also get harder to claim WFH expenses despite the fact that most of us are still working from home due to the pandemic. The ATO’s 80-cents-per-hour shortcut was previously extended until 30 June, but ends tomorrow. Instead you’ll have the usual fixed-rate method of 52 cents available if you don’t want to go through the more complicated process.

You employer will pay more super – love that!

The main change that’ll affect you regarding super is a scheduled increase to the super guarantee, which is basically the minimum contribution your employer has to make to your super fund.

Currently, it’s 9.5% of your base salary, but that will rise to 10% once the super reforms come into effect tomorrow. Some people will see more $$$ in their accounts – others will see their take-home pay actually reducing, depending on how their employer is handling it. Either way, more super = less anxiety about my future at least?

You can read our full explainer on the rest of the changes happening with super here.

The prices of beer may go down

Okay, this might seem kinda random, but the tax burden on small breweries and distilleries is easing starting tomorrow, which could see the price of cracking a cold one with the boys decrease!

Medicare Benefits Schedule (MBS) might leave a lot of patients thousands of dollars out of pocket

There’s a whole bunch of changes coming to the Medicare rebate this financial year, and people aren’t happy about it.

The Medicare Benefits Schedule (MBS) is a list of medical services that are subsidised by the Australian Government, but starting from tomorrow there’s going to be a whole bunch of changes on what is and isn’t on the list. The changes announced could affect medical procedures including general surgery, orthopaedic surgery and cardiac services.

People are worried that the rolling out of these changes hasn’t been very organised (who’s surprised with this government), and there’s fears that people could be forced to pay for surgeries out of pocket, or lose their surgeries altogether because of this. Some are estimating it could lead to as much as $10,000 in extra fees per patient.

“We had enough problems in November 2018 when the first tranche of MBS Review changes resulted in private health insurers, through no fault of their own, not having their schedules updated in time,” said AMA President, Dr Omar Khorshid.

“That meant that no-gap arrangements were not possible or were significantly delayed leading to uncertainty for doctor and patient alike.

“Patients were left out of pocket, spinal surgeries were delayed, and doctors couldn’t provide patients with informed financial consent about potential gap fees.”

A little pay rise for frontline workers, as a treat

NSW front line workers are FINALLY getting a pay rise this financial year (after literally keeping us alive during a pandemic, no less) – but the pay rise is only 1.5%, which unions are not happy about.

Unions have been lobbying a pay rise for frontline workers for ages, and last year the NSW Government offered a one-off $1000 stimulus check instead, which workers obviously found insulting.

1.5% isn’t much, but at least it’s a step in the right direction.

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