The tax refund many Australians expect has dramatically
reduced. We show you why.
There is a psychology to tax refunds that successive Governments have been reticent to tamper with. As a nation,
Australia relies heavily on personal and corporate income tax, with personal income tax including taxes on capital gains representing 40% of
revenue compared to the OECD average of 24%. And, for the amount we pay, we expect a reward.
As part of the previous Government’s efforts to flatten out the progressive individual income tax system, a
time-limited low and middle income tax offset was introduced. The lifespan of the offset was extended twice, partly as a stimulus
measure in response to COVID-19. The offset delivered up to $1,080 from 2018-19 to 2020-21, and up to $1,500 in 2021-22 for those
earning up to $126,000. This was a significant boost for many people each tax time and bolstered the tax returns of millions of
Australians.
For many, the end of this offset has meant that their
tax refund has reduced dramatically compared to
previous years.
We want our people to be the best they can be.
Darren and Jenny have one child and are planning for his secondary education at a Melbourne private school. Utilising education bonds, they aim to ensure they have sufficient funds to cover all tuition fees and associated costs throughout his education.
As Australia's highest marginal tax bracket impacts more individuals, a growing number of Australians face rising tax obligations due to "bracket creep," where wage growth outpaces tax rate adjustments. This trend is expected to persist, with tax-efficient strategies the backbone for financial advice to help individuals secure long-term wealth.
As Australia's highest marginal tax bracket impacts more individuals, a growing number of Australians face rising tax obligations due to "bracket creep," where wage growth outpaces tax rate adjustments. This trend is expected to persist, with tax-efficient strategies the backbone for financial advice to help individuals secure long-term wealth.
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