PwC Tax Rates Summary 2018-19

Personal income tax rates

Residents* – year ending 30 June 2019
Taxable income ($) Tax** ($) % on excess
18,200 Nil 19
37,000 3,572 32.5
90,000 20,797 37
180,000 54,097 45

For the year ending 30 June 2019, a Medicare levy of 2% of taxable income applies to most residents. An additional Medicare levy surcharge of up to 1.5% (see below for rates and thresholds) applies to certain higher income taxpayers not covered by health insurance for private patient hospital cover.

Non-residents* – year ending 30 June 2019
Taxable income ($) Tax** ($) % on excess
0 Nil 32.5
90,000 29,250 37
180,000 62,550 45

* Special rates apply to unearned income of children aged under 18 years at year end where that income is more than $416.

** These amounts do not include the Medicare levy and surcharge, or any tax offsets that may be available.

Medicare levy surcharge (singles) – year ending 30 June 2019
Income for surcharge purposes^ ($) Surcharge rate (%)
90,000 or less 0.00
90,001 – 105,000 1.00
105,001 – 140,000 1.25
More than 140,000 1.50
Medicare levy surcharge (families) – year ending 30 June 2019
Income for surcharge purposes^# ($) Surcharge rate (%)
180,000 or less 0.00
180,001 – 210,000 1.00
210,001 – 280,000 1.25
More than 280,000 1.50

^ Income for surcharge purposes includes, among other things, taxable income, reportable fringe benefits amounts, reportable superannuation contributions and net investment losses.

# The family income thresholds are increased by $1,500 for each dependant child after the first child.

Private health insurance rebate

For premiums paid between 1 April 2018 and 31 March 2019*
Singles
Income for surcharge purposes^ ($) Rebate (%)
Less than 65 years of age Age 65 to 69 years Age 70 years and over
90,000 or less 25.415 29.651 33.887
90,001 – 105,000 16.943 21.180 25.415
105,001 – 140,000 8.471 12.707 16.943
More than 140,000 0 0 0
For premiums paid between 1 April 2018 and 31 March 2019*
Families
Income for surcharge purposes#^ ($) Rebate (%)
Less than 65 years of age Age 65 to 69 years Age 70 years and over
180,000 or less 25.415 29.651 33.887
180,001 – 210,000 16.943 21.180 25.415
210,001 – 280,000 8.471 12.707 16.943
More than 280,000 0 0 0

* Rebate percentages are adjusted annually on 1 April.

^ Income for surcharge purposes is measured for the financial year ending 30 June, and includes, among other things, taxable income, reportable fringe benefits amounts, reportable superannuation contributions and net investment losses.

# The family income thresholds are increased by $1,500 for each dependant child after the first child.


Company income tax rate

  • Base rate* entities - 27.5%
  • All other companies - 30%

* A base rate entity for the 2018-19 income year is one with ‘base rate entity passive income’ that is no more than 80 per cent of its assessable income for the year and which has aggregated turnover of less than $50 million. ‘Base rate entity passive income’ is comprised of a specified list of income types including certain dividends, interest, royalties and rent.


Diverted profits tax rate - 40%

 

Private company loans (Division 7A)

  • Benchmark interest rate for 2018-19 — 5.20%

Superannuation

  • Complying superannuation fund tax rate (excluding non-arm's length component) — 15%
  • Complying superannuation fund tax rate (non-arm's length component) — 45%
  • Non-complying superannuation fund tax rate — 45%
  • Additional tax payable on concessional contributions of very high income earners* — 15%
  • Transfer balance cap (cap on the amount that can be transferred to the tax-free earnings retirement phase of superannuation) — $1,600,000
Superannuation contribution caps – year ending 30 June 2019
Type of superannuation contribution Contributions cap**
Concessional (deductible) $25,000
Non-concessional (non-deductible) $100,000^

* Applies to individuals whose combined income for surcharge purposes (excluding reportable superannuation contributions) and concessionally taxed superannuation contributions exceed $250,000 for the income year.

** Amounts contributed in excess of the applicable cap may be subject to additional tax or included in the individual’s assessable income and taxed at their marginal tax rate. Individuals can choose to have up to 85 per cent of their excess concessional contributions for a financial year released from superannuation. Additionally, individuals can choose to withdraw excess non-concessional contributions plus associated earnings from superannuation. 

^The non-concessional contribution cap is nil if a member’s total superannuation balance (TSB) is greater than or equal to the general transfer balance cap ($1.6 million for 2018-19) at 30 June in the previous financial year. Individuals under 65 years of age can make non-concessional contributions of up to $300,000 over a three-year period (known as the 'bringing forward rule'). Due to the reduction in the non-concessional contributions cap from $180,000 to $100,000 with effect from 1 July 2017, some individuals may have a different cap if the bringing forward rule was triggered in the 2016-17 income year.

Superannuation guarantee charge (SGC)

SGC is payable by employers if during 2018-19 they fail, in relation to each employee, to contribute 9.5% of the employee's ordinary time earnings (base capped at $54,030 per quarter).

 

Managed Investment Trusts (MITs)

  • MIT withholding tax rate for fund payments (resident in an information exchange country*) – 15%
  • MIT withholding tax rate for fund payments (not a resident in an information exchange country*) – 30%
  • “Clean building” MIT withholding tax rate for fund payments (resident in an information exchange country*) – 10%
  • Tax rate for non-arm’s length income derived by MIT – 30%

* An information exchange country is a country with which Australia has an effective exchange of information agreement and is prescribed by Regulation 34 of the Taxation Administration Regulations 2017.

 

Capital gains tax (CGT)

Net capital gains in respect of CGT assets acquired after 19 September 1985 are included in assessable income and taxed at marginal rates.

A CGT discount factor automatically applies to individuals and trustees (of 50%*) and to complying superannuation funds (of 33.33%) in respect of CGT assets acquired after 11.45am Australian Eastern Standard Time (AEST) on 21 September 1999 and held for at least 12 months before the time of the CGT event. The CGT discount is not available for foreign resident or temporary resident individuals in respect of gains accrued after 7.30pm (AEST) on 8 May 2012. The CGT discount remains available for capital gains accrued prior to this time where the relevant individual chooses to obtain a market valuation of assets as at 8 May 2012.

* The Government has announced that, from 1 January 2018 the CGT discount will be increased to 60% for resident individuals investing in affordable housing. The affordable housing must be managed through a registered community housing provider and held for a minimum period of three years.  As at 10 April 2019, this measure was not enacted.

Depreciation - plant and buildings

The rate of depreciation of a depreciating asset (plant) generally depends upon the date of acquisition, whether the taxpayer is a small business entity and the asset's effective life (self-assessed or as determined by the Commissioner).

Years in effective life Prime cost (%) Diminishing value (%)*
2 50 100
3 33.3 66.67
4 25 50
5 20 40
10 10 20
15 6.67 13.33
20 5 10
30 3.3 6.67
40 2.5 5

* Diminishing value rates specified are applicable generally to assets first held on or after 10 May 2006.

Up until 30 June 2020, eligible small businesses (those that carry on business and have aggregated turnover of less than $10 million) and from 7.30pm AEDT on 2 April 2019, eligible medium businesses (those that carry on business and have aggregated turnover of at least $10 million but less than $50 million) can claim an immediate deduction for a depreciating asset that has a cost not exceeding the applicable threshold - either $20,000, $25,000 or $30,000 depending on when the asset was acquired and first used or installed ready for use before 30 June 2020.

The construction cost of income producing buildings and structural improvements may be written off at the following rates where construction commenced on or after 27 February 1992^.

Qualifying buildings and structural improvements Annual deduction (%)
Short-term traveller accommodation 4.0
Industrial buildings 4.0
Other income producing buildings 2.5
Structural improvements 2.5

^ Where construction commenced prior to 27 February 1992, qualifying buildings may be written off at either 2.5% or 4% pa, depending on the date on which construction commenced.

  • Motor vehicle depreciation cost limit for 2018-19 – $57,581

 

Research and Development Tax Incentive

Under the Research and Development (R&D) tax incentive, entities may be eligible for a tax offset for expenditure on eligible R&D activities and for the decline in value of depreciating assets used for eligible R&D activities.

  • Refundable R&D tax offset - Generally only available to eligible entities with an aggregated turnover of less than $20 million
  • Non-refundable R&D tax offset

A $150 million cap (yet to be enacted) on the amount of R&D expenditure that companies can claim as a tax offset at the concessional rates applies. For expenditure over the cap, companies are able to claim a tax offset at the company tax rate.

For income years commencing from 1 July 2018, the Government proposes to change the current R&D regime and replace it with new R&D tax offset amounts that, when enacted, will be as follows:

  • Refundable R&D Tax offset - The claimant's tax rate for the year plus 13.5 percentage points (capped at $4 million per annum, except for R&D on clinical trials).
  • Non-refundable R&D Tax offset - The claimant's tax rate for the year, plus:
    • 4 percentage points for R&D expenditure between 0% and 2% R&D intensity (inclusive) (i.e. R&D expenditure as a percentage of the claimant's total expenses for the year); 
    • 6.5 percentage points for R&D expenditure above 2% to 5% R&D intensity; 
    • 9 percentage points for R&D expenditure above 5% to 10% R&D intensity; and 
    • 12.5 percentage points for R&D expenditure above 10% R&D intensity.

 

 

Fringe benefits tax (FBT)

  • FBT rate for year ending 31 March 2019 – 47%
Type of aggregate fringe benefit amount FBT gross-up factor
Year ending
31 March 2019
Type 1 – entitlement to GST input tax credits 2.0802
Type 2 – no entitlement to GST input tax credits 1.8868
Key FBT figures Year ending
31 March 2019
Benchmark interest rate for loan benefits 5.20%
Car parking benefit threshold $8.83
Record keeping exemption threshold $8,552
Car fringe benefits statutory formula 0.2*

* For contracts entered into from 7.30pm AEST 10 May 2011. Different rates may apply for contracts entered into before this date.

Petroleum Resource Rent Tax (PRRT)

PRRT applies to all onshore and offshore petroleum projects (except those in the Joint Petroleum Development area in the Timor Sea).

  • PRRT rate – 40%

Payroll tax rates and thresholds

State/Territory Rate (%) Annual Threshold ($)1
NSW 5.45 850,000
ACT 6.85 2,000,000
VIC 4.85 / 2.4252 650,000
QLD 4.75 1,100,0003
TAS 6.1 / 4.04 1,250,000
SA 2.5 / 4.955 600,0006
WA 6.5 / 6.0 / 5.57 850,0008
NT 5.5 1,500,0009

1. The above thresholds may be reduced where the company is part of a group and/or pays interstate wages.

2. The lower 2.425% rate applies to business where at least 85% of their Victorian payroll goes to regional employees.

3. This threshold reduces by $1 for every $4 of Australian wages over $1.1 million. Businesses with annual taxable wages of $5.5 million or more will be subject to payroll tax of 4.75% on their entire taxable wages.

4. A reduced rate of 4% applies for taxable wages between $1.25 million and $2 million per annum. An exemption applies for certain wages paid by an interstate business that has relocated to regional Tasmania.

5. A small business rate of 2.5% applies to firms with payrolls between $600,000 and $1 million, then phases up to the general rate of 4.95% for payrolls above $1.5 million. From 1 January 2019, those with wages between $1.5 million and $1.7 million will benefit from a reduced payroll tax rate.

6. From 1 January 2019, businesses with annual taxable wages of up to $1.5 million will be exempt from payroll tax.

7. From 1 July 2018, a tiered payroll tax rate scale applies. For employers paying annual taxable wages of $100 million or less – the general rate of 5.5% applies. For taxable wages of between $100 million and $1.5 billion – a marginal rate of 6% applies, and for employers paying taxable wages of $1.5 billion or more – a marginal rate of 6.5% applies.

8. This threshold reduces gradually for employers with annual taxable wages between $850,000 and $7.5 million. Businesses with annual taxable wages of $7.5 million or more will be subject to payroll tax at 5.5% on their entire taxable wages.

9. This threshold reduces by $1 for every $4 of wages over $1.5 million. Businesses with annual taxable wages of $7.5 million or more will be subject to payroll tax of 5.5% on their entire taxable wages.

The facts and figures outlined in this tax summary are current as at 10 April 2019.

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