2022/23 Federal Budget: Other budget announcements including Superannuation.

Below is a summary of matters handed down in the Federal Budget on Tuesday 29th March 2022 which impact on businesses.  These are all proposals and will still need to be passed by the Senate.  We will keep you posted when/if relevant legislation is passed by the Senate and of any changes.

Extending the reduction in minimum drawdowns

The Government will extend the 50% reduction of superannuation minimum drawdown requirements for account-based pensions (‘ABPs’) and similar products for a further year to 30 June 2023 (i.e., for the 2023 income year).

This will allow people to minimize the need to sell down assets given ongoing market volatility. It applies to account-based, transition to retirement and term allocated superannuation pensions.

Housing affordability

The Home Guarantee Scheme allows first home buyers to build or purchase a newly built home with a low deposit, replacing the need for commercial lenders’ mortgage insurance.

The Government is expanding the scheme to make available:

• 35,000 guarantees each year (up from the current 10,000) from 1 July 2022 under the First Home Guarantee, to support eligible first homebuyers to build or purchase a newly built home with a deposit as low as 5%.

• 10,000 guarantees each year from 1 October 2022 to 30 June 2025 under a new Regional Home Guarantee, to support eligible homebuyers (including non-first home buyers and permanent residents), to purchase or construct a new home in regional areas with a deposit as low as 5%.

• 5,000 guarantees each year from 1 July 2022 to 30 June 2025 to expand the Family Home Guarantee.

This program enables eligible single parents with dependents to enter or re-enter the housing market with a deposit as little as 2%.  Eligible first home buyers may also be able to take advantage of the First Home Super Saver Scheme which allows them to use the concessionally taxed super system to save their first home deposit.

Other federal and state grants and stamp duty concessions may also be available.

Should you require any further information regarding these announcements please don’t hesitate to contact this office.