Here’s a very high level summary of how the budget is going affect you… looking at it, it will affect everybody in their own little way but nothing dramatic so that any one group is severely advantaged or disadvantaged (I think)

Below are just summary with not much details (except the bits that I think is more interesting). If you want more details please visit The Federal Budget

For the Retiring…

• Reduction of concessional contribution cap from 1 July 2009
• Temporary reduction of the Government co-contribution from 1 July 2009 to 30 June 2014
• Extension of 50% minimum pension draw down relief from 1 July 2009
• New Zealand retirement savings portability scheme
• Age pension age to increase to age 67 from 1 July 2017
• Increase in government support pension amount from 20 September 2009
• New pension supplement from 20 September 2009
• Pension Bonus Scheme closed to new entrants from 20 September 2009

For the Working Class People
The tax rates has changed slightly

Income Threshold Tax rate

• $0 – $6,000                  0%
• $6,001 – $35,000         15%
• $35,001 – $80,000       30%
• $80,001 – $180,000     38%
• $180,000+                   45%

the threshold for 30% tax rate has been increased from $34,000 to $35,000 and the 40% tax rate has been reduced to 38%.

Other Changes include:

• Changes to income tax exemption for income earned by Australians working overseas from 1 July 2009
• Private Health Insurance Rebate from 1 July 2010
• Paid Parental Leave from 1 January 2011
• Reform of family payments from 1 July 2009

For Low Income Earners
The Government will increase the Medicare levy low income threshold to $17,794 for individuals and $30,025 for individuals in families. The additional amount of threshold for
each dependent child or student will also increase to $2,757.

The Medicare levy threshold for pensioners below age pension age will also be increased to $25,299. This is to ensure that pensioners below age pension age will not have a Medicare liability where they don’t have an income tax liability.

For the First Home Owners

• 1 July 2009 – 30 September 2009:    $14,000 for established homes or $21,000 for new homes
• 1 October 2009 – 31 December 2009:   $10,500 for established homes or $14,000 for new homes
• After 1 January 2009:    $7,000 for established homes or $7,000 for new homes

For Small Businesses

• Additional small business and general business tax break from 13 December 2008
• Modified Pay As You Go (PAYG) instalments relief for small business from 1 July 2009
• Tightening access to non-commercial business losses from 1 July 2009
• Small business CGT concessions

That’s it from me, but keep an eye out for the May Success Tips Newsletter… I’ll be going into a bit more detail about the First Home Owner Grant and just the stock market in general – as I write the US Market is just about to open, the S&P500 has fallen from a high of around 929 to 884 (about 5% from the high of 929) which is the first decent correction since early March 2009