Tax cuts and payments in Budget 2022

In an attempt to reduce the cost of living in the coming months, the government has confirmed it will be offering a few small payments and tax cuts. It has to be noted that many are however one-offs, or temporary payments.

$250 cost-of-living payment

If you receive government payments, you could be eligible for a one-off ‘cost -of-living payment’ worth $250.

You do not need to apply for this, as it will be paid automatically if you are one of the six million Australians who are on various government payments.

The payment will be exempt from taxation and will not count as income support for the purposes of any income-support payment. Only one payment will be received, even if you are eligible under two or more categories.

The payment will be given to eligible recipients of the following schemes, and to concession card holders:

$420 Cost-of-living tax offset

The government will be phasing out the Low and Middle Income Tax Offset (LMITO), but it will be increasing the payment for everyone by $420 for its last year of operation.

It has been giving annual tax cuts worth between $255 and $1080, depending on taxable income, to people earning below $126,001 per year, however, this financial year (2021-22) will be its final year of operation.

Fuel excise

The fuel excise on diesel and petrol will halve from March 30, from 44.2 cents per litre to 22.1 litre. This will last for six months.

On September 28, the fuel excise will revert to 44.2 cents per litre.

Contact TaxAssist Accountants

If you need any help or advice with the financial aspects of running your business, please contact us today on 1300 513 332 or complete our contact form. We’ll be glad to help.

Last updated: 9th July 2022