Posted on 17 May '13 by , under General News.
The increase in the Medicare levy from 1.5 per cent to 2 per cent, will effectively bring the top marginal tax rate to 47 per cent. This will not only impact on individual taxpayers but will have a flow on effect to small businesses. A number of tax laws that businesses regularly comply with apply the top marginal income rate as a penalty rate of tax.
As a result, the following common tax items will be subject to tax of 47 per cent, up from the previous 46.5 per cent:
– Fringe Benefits Tax (FBT)
– TFN and ABN Withholding Tax
– Family Trust Distributions Tax
– Trusts, where Section 99A applies to retained income
– Excess non-concessional contributions to super (with tax on excess concessional contributions to increase to 32%)