Key tax and superannuation changes in 2013

With the year end approaching, we run through tax and superannuation changes you can expect from January 1, 2013.

January 1, 2013

• The Dad and Partner pay will be available to eligible working fathers and partners who:
– care for a child born or adopted from January 1, 2013
– work full-time, part-time or are casual, seasonal, contract or self-employed workers
– have worked at least 330 hours – just over a day a week – in 10 of the 13 months before the birth of their baby with no more than an eight week gap  between two consecutive working days
– earned $150,000 or less in the previous financial year, and
– fulfil the Australian residency test.
• The SchoolKids Bonus replaces the Education Tax Refund. Around a million families will receive a cash handout of $820 for every high school child and $410 for every primary school child as part of the new bonus. The direct, upfront payments require no paperwork.
• The Government will limit eligibility for Family Tax Benefit Part A to young people under 18 years of age or, where a young person remains in secondary school, the end of the calendar year in which they turn 19. Individuals who no longer qualify for FTB Part A may be eligible to receive Youth Allowance.
• All unemployed single parents will lose the Parenting Payment when their youngest child turns eight. For unemployed partnered parents, the payment will stop when their youngest child turns six. Although the cut-offs were introduced in 2006, it did not apply to parents who were already receiving the support payment. Now, it will apply across the board and force these parents on to the Newstart Allowance while they seek employment. Also, recipients of the Parenting Payment will have compulsory part-time participation requirements when their youngest child turns six.
• There will be a more generous income test for single principal carer parents on Newstart Allowance that will allow them to earn around $400 more per fortnight before ceasing eligibility for payment.
• Individuals can travel overseas and continue to receive income support payments such as the Parenting Payment, Austudy, Rent Assistance and Family Tax Benefit Part A and B – among others – for only six weeks as opposed to 13 weeks.
• The government will increase a number of visa application charges for skilled graduates, partners, working holiday makers and temporary overseas workers.
• The government will restrict telehealth services to those patients for whom distance is the most significant barrier to accessing specialist care, meaning the eligibility criteria for the Medicare Benefits Schedule will be amended to exclude patients in outer metropolitan areas and major cities of Australia.

March 1, 2013

• Recipients of eligible income support payments will benefit from the introduction of a new lump sum Supplementary Allowance. The means-tested, tax-free, indexed payments will be an additional $210 a year for singles and $350 a year for couples – paid in two instalments in March and September.

July 1, 2013

• The Baby Bonus payment for second and subsequent children will be cut from $5,000 to $3,000.
• The maximum rate of Family Tax Benefit Part A will increase by $300 a year for families with one child and $600 per year with families with two or more children. The base rate of the Family Tax Benefit will increase by $100 per year for families with one child and $200 per year for families with two or more children.
• Newly unemployed Australians and students will no longer have to wait 13 weeks to access income support if they have liquid assets of up to $5,000 for singles without children and $10,000 for all others.
• The National Disability Insurance Scheme will begin operating in up to four locations across Australia. 10,000 participants will start being assessed, increasing to 20,000 from mid-2014.
• Self-managed superannuation fund (SMSF) trustees will be subject to a new exacting administrative penalties regime which gives the ATO power to issue penalties, rectification and “education” directions to individual trustees who contravene the SMSF rules.
• Auditors must be registered with ASIC by July 1, 2013 to be legally permitted to be engaged by SMSF trustees and to sign off on SMSF audits.

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