2018 Changes / Key Announcements

Below is a summary of the changes to be aware of and announcements that will potentially affect you for the year ending 30th June 2018 or will come into effect as of 1st July 2018.

1. Personal Income Tax Rates

2017/2018 Financial Year

(plus 2% Medicare levy where applicable)


*There is no 2% budget repair levy from 1st July 2017.

2018/2019 Financial Year

(plus 2% Medicare levy where applicable)


*It is proposed from 1st July 2022 that there will be an increase in the tax thresholds to reduce the tax paid by taxpayers.


Note: The low income offset is $445. This offset will reduce by 1.5 cents for every $1 of taxable income over $37,000. It phases out when the taxable income is $66,667



2. Medicare Levy – Low Income Threshold

For the 2017/2018 income year, Medicare Levy will be incurred when the incomes are above:


  • Individuals                 $21,980
  • Families                     $37,089


Plus $3,406 for each dependent child.


The Medicare levy will now stay the same at 2.0% from 1st July 2019.

 

3. Motor Vehicle – Statutory Formula

A) FBT for Business


The Statutory Formula method to calculate the taxable value of the private use (Fringe Benefit) of a vehicle is a flat 20% statutory rate of the cost of the car. It is no longer based on kms travelled per year.

Important Note: Keeping a valid 3 month logbook is extremely important!


B) Cents per KM for Individuals


The Motor Vehicle Statutory Formula claim for the cents per kilometre for individuals will stay at 66 cents per kilometre for 30th June 2018. There is only one single rate for all engine sizes. Individuals will only be able to claim cents per kilometre method or logbook method. You can no longer claim 12% of original value method or one third of actual expenses method from 1st July 2015.

 

4. Superannuation Contributions (concessional)

The maximum amount that taxpayers can contribute into superannuation as concessional contributions are:


Year ending 30th June 2018             Year ending 30th June 2019

Age under 49        $25,000 max            Age under 49            $25,000 max

Age 49 and above    $25,000 max            Age 49 and above      $25,000 max


Important Notes:


  • From 1st July 2017, all individuals under the age of 75 can claim an income tax deduction for personal superannuation contributions. There will be no more 10% test to claim a tax deduction for personal contributions. Therefore, partially self-employed and partially employed (wages) and individuals whose employers do not offer salary sacrifice arrangements will benefit from proposed changes. Once you reach 65 years of age, you must satisfy the work test.
  • From 1st July 2018, individuals with a superannuation balance of less than $500,000 can make additional concessional contributions if they have not used all their cap in the previous 5 years, on a rolling basis on unused amounts accrued from 1st July 2018.
  • From 1st July 2019, an exemption from the work test for voluntary contributions to superannuation for people aged 65-74 with superannuation balances below $300,000 will be introduced.
  • From 1st July 2019, the government will increase the maximum number of allowable members in new and existing SMSF’s from four to six.

 

5. Superannuation Contributions (non-concessional)

The non-concessional contribution cap (contributions for which you do not claim an income tax deduction) is:


2017 – 2018 Income Year                  $100,000

2018 - 2019 Income Year                  $100,000


People aged under 65 years may be able to make lump sum non-concessional contributions of up to three times their non-concessional cap over a 3 year period (lump sum $300,000 in 2017/2018)


Important Notes:


  • From 1st July 2017, non-concessional contributions can only be made if your total superannuation balance is under 1.6million.

 

6. Superannuation Changes


  1. From 1st July 2017, the government has removed the tax exemption on earnings of assets supporting Transition to Retirement income streams, being income streams of individuals over preservation age but not retired. The earnings will be taxed at 15% and the change is proposed to apply irrespective of when the Transition to Retirement commenced.


2. From 1st July 2017, the government has introduced a $1.6million superannuation transfer balance cap on the total amount of accumulated superannuation an individual can transfer into pension phase. Under the proposed changes:


  • Subsequent earnings on this pension balance will not be restricted
  • If an individual accumulates amounts in excess of $1.6million they will be able to maintain this excess amount in accumulation phase account (where earnings will be taxed at the concessional rate of 15%)


Important: fund members in pension phase with balances above $1.6million will be required to reduce this balance to $1.6million by 1st July 2017.


  1. From 1st July 2017, the low income spouse superannuation tax offset income threshold for low income spouses will increase to $37,000 (from $10,800). The offset will phase out when income reaches $40,000. The low income spouse offset provides up to $540 per annum when $3,000 is contributed into your spouse’s superfund.
  2. From 1st July 2017, First home buyers can voluntarily contribute up to $15,000 into Super ($30,000 in total). The contributions must be with existing concessional and non-concessional caps. From 1st July 2018 these contributions can be withdrawn (plus earnings) for a first home deposit.
  3. From 1st July 2018, people aged 65 or over can make non-concessional contributions into superannuation of up to $300,000 from proceeds of selling their home. These non-concessional contributions will be in addition to the caps, age tests and the $1.6million balance test.

 

7. Net Medical Expense Rebate

For 30th June 2018 financial year, you can only claim net medical expenses offset on aged care, disability aids and attendant care expenses. There is no more rebate on other net medical expenses for 2017 or future years.

 

8. Minors (Children under 18 years)

Families distributing money to children from Family Trust’s will need to be aware that they can only distribute $416 tax free for 30th June 2018 year.

 

9. Additional Tax on Superannuation Contributions – High Income Earners

In the 30th June 2018 year, Individuals with income greater than $250,000 will have their super contributions taxed at 30% and not 15% (this has been in place since 1st July 2012).


Note:


  • Income is taxable income plus reportable fringe benefits, reportable superannuation contributions and any total net investment loss
  • Super contributions include super guarantee and salary sacrifice
  • The tax is payable by the individual client not the superfund however you can apply to have the money released from your superfund.

 

10. Superannuation Guarantee

From the 1st July 2018, the SG rate will stay at to 9.5 per cent. This will remain until 2021 and then increases will be by 0.5 per cent each financial year until 12 per cent is reached. The proposed future increases each year are:


Financial Year      Minimum Superannuation Guarantee Rate


2017/18                                 9.50%

2018/19                                  9.50%

2019/20                                  9.50%

2020/21                                  10.00%

2021/22                                  10.50%

2022/23                                  11.00%

2023/24                                  11.50%

2024/25                                  12.00%


For individuals to claim a deduction for personal contributions, you must have a valid written notice (deduction notice) advising you intend to claim a tax deduction and a written acknowledgement from the superfund.

 

11. Changes To Family Trusts And Income Resolutions

Trustees must ensure that trust income is distributed by an income distribution resolution/minute by the 30th June 2018. These resolutions must show what trust income each beneficiary is entitled to, and the streaming of franked dividends and capital gains if applicable.


Trusts with older deeds should have these reviewed to ensure the definition of income complies with current legal definitions in the tax act and that the deed allows for streaming of capital gains and franked dividends. The trust deed must also state all required beneficiaries.

 

12. Changes to Rental Properties

a. From 1st July 2017, travel expenses will be disallowed for inspecting, maintaining or collecting rent for residential rental properties.


b. From 9th May 2017, investors who purchase residential investment properties will only be able to claim depreciation on plant and equipment on new acquisitions of plant and equipment

  • Investors who purchase new plant and equipment can still claim depreciation after 9th May 2017
  • From 9th May 2017, investors cannot claim depreciation on any plant and equipment that was purchased with the property or was used previously for private use
  • Existing property investors, before 9th May 2017, can continue to claim depreciation
  • All investors can continue to claim the depreciation on the building costs from 9th May 2017


c. From 1st July 2019, the government will deny deductions for expenses associated with holding vacant residential or commercial land, including interest on finance for the acquisition of the land. Deductions for expenses associated with holding land will be available once a property has been constructed, it has received approval to be occupied and is available for rent. Denied deductions will not be able to be carried forward for use in later income, however, denied deductions can be included in the cost base of the land.

 

13.  Changes To Private Health Insurance Rebate And Medicare Levy Surcharge


The private health insurance rebate is now income tested and the Medicare levy surcharge will be increased based on your income if there is no appropriate private hospital cover for the year. The following table summarises the changes to the private health insurance (PHI) rebate and the Medicare levy surcharge based on the income levels from the 1st April 2017 (the rebate % has decreased from last year):


(For families with more than one dependent child, the relevant threshold is increased by $1,500 for each child after the first)

14.  Change To Depreciation

Small businesses with aggregate annual turnover of less than $10 million can immediately deduct assets they start to use or install ready for use, provided the asset costs less than $20,000 (GST excl). This will apply for assets acquired and installed ready for use at 30 June 2018. Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed in the small business simplified depreciation pool (‘the pool’) and depreciated at 15% in the first income year and 30% each income year thereafter. The pool can also be immediately deducted if the balance is less than $20,000 over this period (including existing pools). It is proposed that this concession is to extend until 30th June 2019.

Note: this is for small business entities, not employees or rental properties

 

15.  Increase Small Business Entity Turnover Threshold

For 30th June 2018 and 30th June 2019, the Small Business Entity (SBE) turnover threshold is $10million. This will allow businesses (with turnover less than $10million) to access:


  • Lower (27.5%) corporate tax rate (businesses with $25million turnover can access this)
  • Simplified depreciation rules (including immediate deduction for an asset purchased costing less than $20,000 until 30th June 2019)
  • Simplified trading stock rules if their stock has changed by less than $5,000
  • Option to account for GST on cash basis


Note: the $2 million turnover threshold will be retained for small business capital gains tax concessions.

 

16.  Higher Education Loan Programme (“HELP”) & Trade Support Loan (TSL) – repayment thresholds

For 2018/2019 the threshold and repayment rate to pay back debt is:

Repayment Income                      Repayment Rate

Below $42,000                         Nil

$42,000 – $44,520                                         1.00%

$44,520 - $47,191                                          1.50%

$47,191 - $50,022                                          2.00%

$50,022 - $53,024                                          2.50%

$53,024 - $56,205                                          3.00%

$56,205 - $59,577                                          3.50%

$59,577 - $63,152                                          4.00%

$63,152 - $66,941                                          4.50%

$66,941 - $70,958                                          5.00%

$70,958- $75,215                                           5.50%

$75,215 - $79,728                                          6.00%

$79,728 - $84,512                                          6.50%

$84,512 - $89,582                                          7.00%

$89,582 - $94,957                                          7.50%

$94,957 - $100,655                                       8.00%

$100,655 - $106,694                                      8.50%

$106,694 - $113,096                                      9.00%

$113,096 - $119,882                                      9.50%

$119,882 and above                                     10.00%


Australians who have a HELP or TSL and are residing overseas, will be required to make repayments against their debt from 1st July 2017 based on their 2016/2017 worldwide income. Overseas debtors are required to update their contact details via MyGov within 7 days of leaving Australia.

 

17.  Small Business Income Tax Offset (SBITO)

For the 30th June 2018 financial year, individuals will receive a 8% tax discount as a non-refundable tax offset on business income. This includes Sole Traders, Partners in Partnership and Trust Distributions where the entity carries on a business. The entity must be a small business entity with a turnover of under $5million. The tax discount will be capped at $1,000 per individual for each income year.

 

18. Reducing the Company Tax Rate

For the 30th June 2018 financial year, the company tax rate for small businesses is 27.5% (reduction of 2.5%) for companies with aggregated annual turnover of less than $25million. Companies with aggregated turnover of $25million or above or who are not carrying on a business will continue paying tax at 30% on all their taxable income.


Note: the current maximum franking credit rate for distribution will be 27.5% for these companies in 2017/2018.

 

19. Zone Offset Change

From 1st July 2015, all FIFO (Fly In, Fly Out) and DIDO (Drive In, Drive Out) workers will not be able to claim the zone rebate for the zone they work in. The zone rebate entitlement will only relate to the zone of their normal place of residence. Taxpayers who actually reside in a zone can continue to claim the zone rebate.

 

20. Supersteam Requirements for Employers and SMSFs

Employers must make Superannuation contributions on behalf of employees by submitting payments and data electronically. Superannuation Funds (including SMSFs) must receive contributions from employers (that are not related parties of the SMSF) electronically. The start date for Superstream was 1st July 2016.


Businesses need to setup the free ATO clearing house or a clearing house with another company to arrange the Superstream compliance. SMSFs need to obtain an electronic service address and this is setup through a messaging provider. If you require help setting this up, please contact us.

 

21. Reducing Claim Period for Family Assistance Lump Sum Claims

Families that choose to wait until the end of the financial year to claim their FTB entitlement or child care benefit will have a grace period of one year. Therefore, all 2017 tax returns must be lodged by 30th June 2018 and all 2018 tax returns must be lodged by 30th June 2019.

 

Reminder of Things to Consider Before 30th June
  • Consider making the $1,000 personal contribution to qualify for the super co-contribution before the 30th June if your taxable income will be below the thresholds.
  • Consider making a spouse contribution into superannuation if you qualify for the rebate.
  • Ensure your 3 month logbooks have been kept on vehicles.
  • Make sure you have receipts for your tax deductions.
  • Review the need to sell capital assets to obtain any capital losses if you have made any capital gains during the year.
  • Obtain/prepare a summary of child support paid during the year if you are paying child support or child support you may have received, if you are receiving.
  • Businesses:


- Make sure you have odometer readings for all work vehicles.

- Super must be paid for staff by the 28th July. However to get the deduction in the 2017/2018 year it must be paid before the 30th June (or received by Superfund if paid by transfer).

- PAYG Summaries must be issued to all staff by the 14th July.

- Trust Resolutions/Minutes for all trusts must be prepared and signed before 30th June 2018.

- Businesses in the building and construction industries must lodge their payment annual reports for payments made to contractors during the year by 28th August 2018. From 1st July 2018 this will also include cleaning and courier industries.


  • Individuals:



- Home office claim – ensure you have a 4 week diary recording hours worked from home for work. Must be kept to claim home office deduction.

- Internet claim – ensure you have kept a 4 week diary recording internet usage (hours used for work/hours used personally) to support your work internet claim. This must be kept to claim home internet as a work deduction.

- Motor Vehicle deduction – ensure you keep a 4 week diary of vehicle kilometres used for work to support the tax deduction.


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5 Things You Might Be Forgetting to Do That Could Save You Money

October 13, 2026
When you're looking for ways to save money, it's easy to focus on the big expenses.  But sometimes the easiest savings are sitting in the things you pay for every month without really thinking about them. Subscriptions, unused services and small recurring expenses can quietly add up over time. Here are five simple things worth checking. 1. Audit Your Subscriptions Start by looking at all the subscriptions you're currently paying for. Go through your Apple App Store or Google Play Store accounts and check what you're being charged for each month. You may find subscriptions you've forgotten about, apps you no longer use or services that are automatically renewing. Even a few dollars here and there can add up to a significant annual expense. 2. Cancel Services You Don't Use If you've paid for a service that you haven't used in the past month, ask yourself whether you really need it. Unused streaming services, apps, memberships and other recurring payments can continue taking money from your account long after you've stopped using them. Cancelling an unnecessary subscription is one of the easiest ways to stop the leakage. 3. Negotiate Better Deals If you've been with the same provider for a long time, don't assume you're already getting the best deal. It may be worth contacting your provider and asking whether there is a better plan or rate available. This could apply to a range of services where you're a long-term customer. A few minutes spent asking the question could result in ongoing savings. 4. Set Reminders for Renewals Free trials and annual subscriptions can be easy to forget about. Set a reminder for when a free trial ends or when a subscription is due to renew. That gives you the opportunity to decide whether you still want the service before you're charged again. Your calendar or phone can prompt you. 5. Track Your Spending Small expenses are easy to overlook when they're spread across multiple accounts and services. Using a budgeting app or regularly reviewing your transactions can help identify areas where you're spending more than you realise. You may discover recurring payments or habits that no longer represent good value. Small Changes Can Add Up Saving money doesn't always require a major lifestyle change. Sometimes it's simply about paying attention to where your money is going and cutting expenses you no longer need. The article provided makes the same point: regularly reviewing subscriptions and cutting back on unnecessary expenses can help build a stronger financial foundation. saving costs things to look at At Ascent Accountants, we can help you look at the bigger picture of your finances and identify opportunities to make your money work harder for you.

Buying Property? What Does an Unexpected Caveat Mean?

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Finding a caveat on a property you're looking to buy can be an unwelcome surprise. A caveat can prevent certain dealings with a property from being registered, which can delay a sale or prevent a purchaser from settling until the issue has been dealt with. It can also create problems with finance because lenders generally require clear title. First, What Is a Caveat? A caveat is a legal notice recorded against a property. Importantly, a caveat may only be lodged by a person or entity with a legal or equitable proprietary interest in the land. It effectively acts as a statutory injunction, preventing the Registrar of Titles from registering certain dealings with the property, such as transfers, mortgages or leases, unless the caveat is withdrawn, removed by court order or otherwise lapses. caveat on properties Why Might a Caveat Be Lodged? There are several reasons why a caveat may be placed on a property. These can include securing a debt owed by the borrower, protecting a buyer's equitable interest in land under a contract of sale, or protecting an unregistered or equitable mortgage. A caveat can therefore indicate that another party has an interest in the property that needs to be resolved. How Can a Caveat Affect a Property Purchase? If you're buying a property with a caveat on the title, it can complicate the transaction. For example, the sale may be delayed or prevented from proceeding until the caveat has been dealt with. It can also affect finance. Lenders generally require clear title, so an unresolved caveat may make it difficult to obtain or finalise finance. What Should You Look Out For? If a caveat appears on a property, you're considering buying, don't simply assume it will disappear before settlement. Find out: Why the caveat has been lodged. Who has lodged it. What interest the caveator is claiming. Whether the caveat needs to be withdrawn or formally removed. Whether it could affect your ability to settle or obtain finance. The type of caveat matters too. The source material identifies different types, including absolute caveats, subject-to-claim caveats, caveats lodged after notice, improper dealing with caveats and registered proprietor's caveats. caveat on properties How Is a Caveat Removed? There are several possible ways of dealing with a caveat, depending on the circumstances. These can include withdrawal by the caveator, statutory removal or court resolution. A withdrawal generally needs to be signed by the caveator and lodged electronically where required. There is also a process for applying for removal under section 138B of the Transfer of Land Act 1893. caveat on properties The caveator has 21 days after being served with the relevant notice to act, although the Supreme Court may order an extension in some circumstances. Don't Let a Caveat Catch You by Surprise If you're buying or selling property, understanding what is recorded on the title is an important part of the process.  An unexpected caveat doesn't necessarily mean a property deal can't proceed, but it does mean there is an issue that needs to be understood and dealt with. At Ascent Property Co, we can help you understand the financial implications of a property transaction and work alongside your legal advisers to help you make informed decisions.

Car Logbooks: 8 ATO Audit Traps You Need to Avoid

October 13, 2026
Are you using the logbook method to claim car expenses? The ATO has been increasing its audit focus on car expense claims, with particular attention being paid to both whether logbooks meet the requirements, and if the business-use percentage has been calculated correctly. Here are eight common areas that could cause potential issues with your claim. 1. Keeping a logbook in the wrong income year A valid logbook must be kept in the first income year in which you use the logbook method to claim car expenses. After that, a new logbook is generally required every five years. If you're not sure whether your current logbook is still valid, it's worth checking before relying on it for your tax return. 2. Not keeping the logbook for the full 12 weeks A valid logbook needs to cover a continuous period of at least 12 weeks. The 12-week period can cross from one income year into another, provided it includes part of the relevant income year. 3. Choosing your busiest 12 weeks It can be tempting to choose a 12-week period when you were doing more business driving than usual. But the business-use percentage from a 12-week logbook isn't automatically the percentage you can apply for the entire year. Your calculation needs to consider variations in how the car was used throughout the year. 4. Forgetting about a replacement car If you replace your car during the income year, you can't simply transfer your existing logbook to the new vehicle due to changes in usage. If you want to rely on the existing logbook for the replacement car, there are nomination requirements that need to be met. Otherwise, a new logbook may be required. 5. Writing vague descriptions of business trips The details matter. A logbook needs to record the relevant details of each business journey, including the dates, odometer readings, kilometres travelled and the purpose of the journey. Entries such as "business trip", "client visit" or "customer visit" may not be enough . The description should explain why the journey was made. 6. Reconstructing your logbook later Your logbook should be kept as you make the journeys, or as soon as possible afterwards. Inconsistent entries, duplicated dates, identical odometer readings or records that don't line up with other information can raise questions about whether the logbook was reconstructed from memory. 7. Getting business and private kilometres wrong Your business-use percentage needs to be based on a reasonable estimate of your business kilometres for the year. That means considering changes in your work, holidays, leave, changes in employment duties, changes in your work location and other variations in how the vehicle was used. 8. Forgetting your odometer records and receipts A logbook is only part of the record-keeping requirements. You also need odometer records for the relevant period, and car expenses such as registration, insurance and servicing generally need to be supported by appropriate records. What Should You Do?  If you use the logbook method, don't assume that having a 12-week logbook automatically makes your claim correct and compliant. The ATO's increased scrutiny means it's important to make sure your logbook is valid, your entries are accurate and your business-use percentage reflects how the vehicle was used throughout the year. At Ascent Accountants, we can help you review your car expense records and make sure your logbook and business-use calculation meet the requirements before you claim.

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The New $1,000 Work-Related Deduction: What Does It Mean for Your 2027 Tax Return?

September 14, 2026
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