Tax Updates for the 2012-2013
Financial Year.
The following are the changes to the tax code for the 2012-2013 tax year:
Flood Levy
The Flood Levy imposed in 2012 is no longer in effect.
Tax Free Threshold
The change to the tax free threshold initiated in 2012 under the government’s Household Assistance Package comes into full effect this year. The Tax Free Threshold for 2013 moves up to $18,200. When combined with any applicable Low Income Tax Offset (LITO), the amount under which you may pay no net tax effectively goes up to $20,542
Low Income Tax Offset
Individuals who earned less than $67,667 during the 2013 financial year are eligible for the Lower Income Tax Offset or LITO. However, following the increase in the Tax Free Threshold, LITO is reduced from $1,500 to $445 and is phased out at the rate of 1½ cents per dollar of taxable income in excess of $37,000.
Personal Tax Rates 2012-2013
The change to the Tax Free Threshold also impacts the marginal tax rates of those whose income falls above the new threshold. For example, the rate for those with income under $37,000 rises to 19% from last year’s 15%. Similarly, taxpayers whose income falls in the next tax bracket - above $37,000 but under $80,000 - will see their tax rate increase by 2½% to 32.5%.