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# What you need to know about the 2023 tax changes

If you are a taxpayer in Australia, you may be wondering what changes are coming in the 2023 tax year. Whether you are an individual, a small business owner, or a property investor, there are some important updates that you should be aware of. In this blog post, we will summarise some of the key tax changes that will affect you in 2023 and how you can prepare for them.

## Personal tax rates unchanged

The good news is that there are no changes to any personal tax rates or thresholds in 2023-24. This means that you will pay the same amount of income tax as you did in 2022-23, based on your taxable income. However, you will not receive the low and middle income tax offset (LMITO) anymore, as it ended on 30 June 2022. The LMITO was a temporary tax cut for anyone earning up to $126,000, with the greatest benefit of $1,500 going to those earning between $48,000 and $90,000 in 2021-22.

## Instant asset write off returns with a $20,000 threshold

If you are a small business owner, you may be eligible for the instant asset write off scheme, which allows you to claim an immediate deduction for the cost of eligible assets that you purchase and use for your business. The scheme has been extended until 30 June 2024, but the threshold for each asset has been reduced from $150,000 to $20,000 from 1 July 2023. This means that you can only claim an instant deduction for assets that cost less than $20,000 each (excluding GST), unless they are part of a set or have identical functions.

## New tax incentives to boost the housing market

If you are a property investor, you may be interested in the new tax incentives that the government has introduced to boost the supply and affordability of housing in Australia. These include:

– A new Family Home Guarantee scheme, which will provide 10,000 single parents with dependent children with a guarantee to purchase a home with a deposit of as little as 2 per cent.
– A new First Home Super Saver Scheme (FHSSS), which will allow first home buyers to save up to $50,000 in their superannuation fund and withdraw it tax-free to buy their first home.
– A new Downsizer Contribution scheme, which will allow people aged 60 and over to make a one-off contribution of up to $300,000 into their superannuation fund from the proceeds of selling their home.

## Superannuation changes

There are also some changes to superannuation that will affect both workers and retirees in 2023. These include:

– An increase in the superannuation guarantee rate from 10.5 per cent to 11 per cent from 1 July 2023. This means that your employer will contribute more money into your superannuation fund each pay period.
– An end to the temporary reduction on minimum super drawdown rates for retirees from 1 July 2023. This means that retirees will have to withdraw more money from their superannuation account each year, based on their age and account balance.
– A new Veterans’ Superannuation (Invalidity Pension) Tax Offset (VSTO), which will ensure that veterans and their beneficiaries do not pay more tax because of the Douglas court decision. This decision changed the way that invalidity pensions paid by the Department of Veterans’ Affairs are taxed.

## Working from home expenses

If you have been working from home due to COVID-19 or other reasons, you may be able to claim a deduction for some of your expenses. The ATO has revised the fixed rate method for calculating your deduction for working from home expenses from 1 July 2023. The revised fixed rate method is $0.67 per work hour and covers expenses such as electricity, gas, phone and internet. You can also separately claim a deduction for the work-related use of depreciating assets such as office furniture and technology.

Alternatively, you can use the actual cost method, which requires you to keep records of all your expenses and apportion them between work and personal use. You can no longer use the shortcut method, which was a temporary measure that allowed you to claim $0.80 per work hour without keeping detailed records.

## How we can help

At Tax Solve Consultancy, we are here to help you with all your tax needs. We are a professional tax service provider with over 10 years of experience in the industry. We can help you with:

– Preparing and lodging your tax return
– Maximising your tax deductions and offsets
– Planning your tax strategy for the future
– Advising you on the latest tax changes and how they affect you
– Resolving any tax issues or disputes with the ATO

If you want to get in touch with us, you can visit our website at [taxsolveconsultancy.com.au](https://taxsolveconsultancy.com.au) or call us on 0452 642 744. We look forward to hearing from you and helping you achieve your tax goals.

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