Budget Revenue measures and tax changes 2021
The major revenue measures announced in the Budget included:
 Bring forward of the second stage of the personal tax cuts by 2 years to 1 July 2020, lifting the 19% threshold
from $37,000 to $45,000, and lifting the 32.5% threshold from $90,000 to $120,000. At the same time, the low and
middle income tax offset (LMITO) will be retained for 2020-21.
 The Stage 3 personal income tax cuts remain unchanged and will commence in 2024-25 as already legislated.
 Loss carry-back: The Government will allow eligible companies to carry back tax losses from the 2019-20, 2020-21
or 2021-22 income years to offset previously taxed profits in 2018-19 or later income years.
 Asset write-off: For eligible capital assets acquired from 7:30pm AEDT on 6 October 2020 and first used or installed
by 30 June 2022, over 99% of businesses will be able to write off the full value of any eligible asset they purchase for
their business. This will be available for small, medium and larger businesses with a turnover of up to $5 billion
until June 2022.
 Corporate residency test to be clarified: The Government will make technical amendments to clarify the corporate
residency test. It will amend the law to provide that a company that is incorporated offshore will be treated as an
Australian tax resident if it has a ‘significant economic connection to Australia’. This test will be satisfied where both
the company’s core commercial activities are undertaken in Australia and its central management and control is in
Australia.
 Superannuation: Several measures were announced. Commencing on 1 July 2021, the Your Future, Your
Super package will see the following changes:
 YourSuper portal – the ATO will develop systems so that new employees will be able to select a super
product from a table of MySuper products through the YourSuper portal;
 stapled accounts – an existing super account will be “stapled” to a member to avoid the creation of a new
account when that person changes their employment;
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 MySuper benchmarking – from July 2021, APRA will conduct benchmarking tests on the net investment
performance of MySuper products, with products that have underperformed over two consecutive annual
tests prohibited from receiving new members until a further annual test that shows they are no longer
underperforming;
 super trustees – best financial interests duty – the Government will legislate to compel super trustees to
also act in the best “financial” interests of their members. The Government will also require super funds to
provide better information regarding how they manage and spend members’ money in advance of Annual
Members’ Meetings.
 R&D: For small companies, those with aggregated annual turnover of less than $20 million, the refundable R&D tax
offset will be set at 18.5 percentage points above the claimant’s company tax rate, and the $4 million cap on annual
cash refunds will not proceed. For larger companies, those with aggregated annual turnover of $20 million or more,
the Government will reduce the number of intensity tiers from 3 to 2.
 ATO funding: The Government will provide $15.1 million to the ATO to target serious and organised crime in the tax
and super systems.
 JobMaker hiring credit: The Government announced a new JobMaker hiring credit to encourage businesses to hire
younger Australians. The JobMaker hiring credit will be payable for up to 12 months and immediately available to
employers who hire those on JobSeeker aged 16-35. It will be paid at the rate of $200 per week for those aged under
30, and $100 per week for those aged between 30-35. New hires must work for at least 20 hours a week. All
businesses, other than the major banks, will be eligible.
 The Government has committed to creating 100,000 new apprenticeships.
 Age Pensioners will receive an additional $250 payment from November 2020 and a further $250 payment from
early 2021