NEW LOW AND MIDDLE INCOME TAX OFFSET – NOW LAW
Unless you have been living under a rock, you would have been aware that recently the Federal Government announced in the recent budget, that the Low and Middle Income Tax Offset has increased to a maximum of $1,080 as from the 2018/19 financial year. Previously the maximum offset was $530.
The new increase sparked an unprecedented volume of tax return lodgements in the first couple of weeks in July, as many people thought they would receive an instant extra refund of $1,080. However, the new offset only applies to taxpayers in the following taxable income brackets;
$37,000 or below will receive the low and middle income tax offset of up to $255, above $37,000, and below $48,000 will now receive $255, plus an amount equal to 7.5% of the maximum offset of $1,080, above $48,000, and below $90,000 are eligible for the maximum low and middle income tax offset of $1,080, above $90,000 but no more than $126,000 are eligible for the low and middle income tax offset of $1,080, less an amount equal to 3% of the excess.
Those taxpayers with taxable income above $126,000 are not eligible for the Low and Middle Income Tax Offset in any part.