July changes you need to know about
July is full of changes
There is a lot going on from July 1. A raft of changes is coming in across Government, energy suppliers, superannuation and strata schemes.
There are very few Australians that won’t be affected by these changes and you need to be aware of them. If you need any further advice of how these changes will specifically affect your investments and strategy, please contact your financial planner.
Property investment changes and first home buyers
In our previous post on the Federal Budget we detailed how the changes to the depreciation rules will affect your investment property. The key takeaway from that is:
One key change is that equipment and plant depreciation deductions will be limited to costs actually incurred by an investor, that is unless an investor has physically bought an item you can no longer claim depreciation. We feel that under these proposed changes it will be the original developer who is deemed to have purchased these items.
In an attempt to cool the housing market overseas investors are now being slugged higher fees, with the Foreign Investor Surcharge doubling to 8%. First home buyers in NSW get a leg up across a number of initiatives including the abolition of stamp duty on first home up to $650,000.
The minimum wage is increasing
Yes you heard it correctly the minimum wage is on the rise so if you are slugging it out you can expect a bit of a bigger pay packet with a $22 weekly rise to take the wage to $694.90.
Online shopping is going to cost you more
Who doesn’t love a late night binge on ASOS or an awesome movie weekend on Netflix? Well you can still do it – it is just going to cost you more. Most if not all your overseas shopping experiences will now attract the 10% GST that has been avoided for so long. So unless you are somehow shopping, or watching movies for business you will be paying more.
On the upside this will give the Government more revenue to spend on the population!
Changes to superannuation contributions
There is a lot going on with super. The key takeaways are that non-concessional contributions are now capped at $100,000 per year up to a lifetime limit of $1.6M. Your pre-tax contributions have been given a haircut as well. The maximum pre-tax contributions are now capped at $25,000 and that includes your employers legislated contributions.
Prices for power are going up
There has been a lot of noise in the media lately about gas and power prices, and none of it is good for the consumer. Suffice to say that on average, most NSW households will be paying around $400 a year more. Thinking laterally, is it time to invest in energy companies?
Where have your frequent flyer points gone?
Changes to banks interchange fees have seen all the majors clamping down on how many frequent flyer points you can earn on your credit cards. The fees are now being capped at 0.08% which means the banks will make less money, which means they can buy less points in bulk from the airlines.
Just about every major credit card is effected, and most will see points cut in half, American Express points still seem like a good bet, but make sure you check with your provider to see where your points have gone!
As always if you need some advice please do not hesitate to contact us.