Several tax announcements from the 2020 Federal Budget have now been passed into law.

These include bringing forward changes to the personal income tax thresholds so that they apply from 1 July 2020. From that date, the top threshold of the 19% personal income tax bracket is increased from $37,000 to $45,000. The top threshold of the 32.5% tax bracket is increased from $90,000 to $120,000. The low income tax offset increases to $700 and the low and middle income tax offset (up to $1,080) is retained for 2020-2021.

How Do I Apply These Tax Tables

• MYOB – For Essentials, the latest tax tables software has been automatically updated and are now available and ready to use. For AccountRight users, updated tax tables are avialable for you to download at my.MYOB.
• Xero – All Xero files are automatically updated, more information can be found here

A range of tax concessions already available to small businesses have been extended yo medium sized businesses as well, and businesses with turnover less than $5 billion can deduct the full cost of eligible depreciating assets that are installed ready for use by 6 October 2020 and 30 June 2022.

Implement New PAYG Withholding Rates by 16 November

The ATO has issued updated tax withholding schedules to reflect the 2020-2021 income year personal tax cuts. Employers must now make sure they are withholding the correct amounts for pay runs processed in their systems from no later than 16 November onwards.

With these changes coming partwat through the income year, employees and other payees will receive their entitlement to the reduced tax payable for the entire 2020-2021 year when they lodge their income tax returns for that period.