2024 federal budget overview

Last night’s Budget was very much focused on providing Australians with relief from cost of living pressures rather than focusing on tax reform.

Below are some of the highlights of items that have been announced recently (either last night or over the previous few weeks) that form part of the Government’s economic plan.

Superannuation

Superannuation Guarantee contributions will be paid to all recipients of Government-funded Paid Parental Leave for parents of babies born or adopted on or after 1 July 2025. Contributions will be at the same rate as employer contributions under the Superannuation Guarantee, which will be 12% from 1 July 2025. Payments will be made annually to individuals’ superannuation funds from 1 July 2026.

Personal taxation

No changes to personal income tax: The Budget did not contain any measures announcing changes to personal income tax however the Government focused on their amendments to the Stage 3 tax cuts which became law back in March 2024. As a reminder the new tax rates to take effect from 1 July 2024 are:

Small business taxation

$20,000 instant asset write-off: Small businesses with an annual turnover of less than $10 million will also be eligible to immediately deduct the full cost of eligible assets costing less than $20,000 for assets that are first used or installed ready for use between 1 July 2024 and 30 June 2025. Small businesses can instantly write off multiple assets as the $20,000 threshold will apply on a per asset basis. Assets costing more than this can be added to small business pools under the simplified depreciation rules.

Cost of living

The budget was heavily focused on providing Australians with some relief from the cost of living pressures, the key areas to note are: 

• Energy Bill Relief Fund: An electricity bill credit of up to $300 will be available in 2024/25 for all Australia households. Eligible small businesses will receive a credit of up to $325. 
• Indexation of the Higher Education Loan Program (and other student loans) debt will be limited to the lower of either the Consumer Price Index or the Wage Price Index, effective from 1 June 2023. This will result in a reduction of last year’s indexation from 7.1% to 3.2%. The ATO will recalculate this and credit those taxpayers who debt was increased on 1 June 2023. 
• The maximum rates of the Commonwealth Rent Assistance will increase by 10% from 20 September 2024.
• Social security deeming rates will be frozen at their current levels for a further 12 months until 30 June 2025. The lower deeming rate will remain at 0.25% and the upper deeming rate will remain at 2.25%.

If you would like more information on any of the budget announcements that may affect your business, reach out to your Maxim advisor today.