Money Matters for 2019

The start of a new year is a great time to review your finances. Here are some recent changes and new opportunities to consider in 2019 and beyond.

First home deposit

Voluntary super contributions made since 1 July 2017, may now be withdrawn to buy a first home under the First Home Super Saver Scheme (FHSSS). The FHSSS allows eligible first home buyers to save their deposit in the concessionally taxed super environment.

HECS and HELP debts

From 1 July 2019, students and graduates who earn $45,881 pa or more will need to start repaying their HECS and HELP debts. Currently, repayments don’t need to be made until $51,957 pa or more is earned. Repayment rates will also change and a lifetime debt limit will be introduced.

Instant asset write-offs

Small business owners may be able to claim an immediate tax deduction of up to $20,000 when purchasing certain assets before 30 June 2019. From 1 July, the claimable amount will reduce to $1,000.

Catch-up super contributions

Super fund members, who make concessional contributions of less than the cap of $25,000 in 2018/19, may be able to contribute more than the cap amount in 2019/20 and beyond. This could enable ‘catch-up’ super contributions to be made in future financial years. Concessional contributions include all employer contributions (super guarantee and salary sacrifice), personal contributions claimed as a tax deduction and certain other amounts.

Super work test exemption

The Government has released regulations to allow retirees aged 65 to 74 with ‘total super balances’ below $300,000 to make voluntary super contributions in the first year they don’t meet the ‘work test’ from 1 July 2019. This measure gives eligible recent retirees more time to make super contributions before they become ineligible. Currently, 65 to 74-year-olds need to have worked at least 40 hours in 30 consecutive days in a financial year to be able to contribute to super.

Super fund members aged 65 or over may be able to contribute up to $300,000 per person to super from the sale of their home after 1 July 2018 if they meet certain conditions. These ‘downsizer’ contributions don’t count towards the concessional and non-concessional contribution caps and can be made without needing to meet the usual age, work, and other contribution tests.

Tax offset for aged care costs

For the 2019/20 and subsequent financial years, aged care residents will no longer be able to claim a portion of certain care costs (such as daily care fees and means-test fees) as a tax offset when they complete their tax return. This could increase the income tax payable by some aged care residents.

Need help?

We can help assess whether any of these opportunities suit your needs and situation and make suitable adjustments to your financial plans. Contact us on 1300 888 803 and speak with a Modoras Professional today or click here to come in for a coffee and chat. You’ll be amazed how far our expert guidance can take you.

IMPORTANT INFORMATION: This blog has been prepared by Modoras Pty. Ltd. ABN 86 068 034 908 an Australian Financial Services and Credit Licences (Number 233209). The information and opinions contained in this presentation is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals’ personal circumstances have been taken into consideration for the preparation of this material. Any individual making any investment or borrowing decisions should make their own assessment taking into account their own particular circumstances. The information and opinions herein do not constitute any recommendation to borrow funds or purchase, sell or hold any particular investment. Modoras Pty Ltd recommends that no financial product or financial service be acquired or disposed of, credit contract entered into or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this blog may change without notice. Modoras Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication.