With the COVID pandemic affecting Australians all over the country, the Federal Australian Government has announced sweeping tax cuts for the 2021 – 2022 financial year.

These cuts will affect over half of all Australians (10.2 Million) and are aimed at low- and middle-income families.

The offsets will provide a value of $1080 for single income Australians, and $2160 for dual-income couples.

Tax cuts explained

The way these tax cuts are designed is slightly different to a traditional Federal tax cut. You will not see a decrease in your paycheque-to-paycheque tax contributions.

Instead, this tax relief will be provided to you once you lodge your tax return. Providing Australians with an in-direct stimulus.

Over four million Australians find themselves in the $40,000 to 90,000 income bracket. Meaning that almost half of the affected Australians by this will see a return of $480-$1080 tax bonus.

The Federal Government estimates by the 2024 – 2025 financial year, almost 95% of all taxpayers in Australia will see a marginal tax rate of 30% or less.

A Practical Example: Robert the Forklift Operator

Robert is a forklift operator, earning $60,000 a year. Robert will fall under the middle-income bracket that over four million Australians find themselves in.

With an income between $48,001 to $90,000, Robert will be provided with a maximum benefit in his tax relief of $1080 for his 2021 – 2022 tax return.

Do you still a question about lodging your tax return? Contact Immunity Accounting, our experienced tax specialists will be able to help. Call 1300 514 191  or book an appointment online.