Tax Time 2013: Key Changes

There have been a number of significant changes to tax products, tax return forms, instruction guides and requirements for Tax Time 2013.

The Tax Office has released tax return forms, schedules and instructions for the 2013 income year.

Some of the key changes for 2013 include:

Tax-free threshold increased

The tax-free threshold has been increased to $18,200.

If your taxable income is under the tax-free threshold, there are reasons why you may still need to lodge an income tax return. The most common reason would be that you had pay as you go (PAYG) withheld from payments received during the year.

Electronic refunds

Individual tax returns with an estimated refund will require Australian bank account information including BSB, account number and name to be entered when lodging electronically.

For more information refer to EFT refunds.

Private health insurance rebate

Your entitlement to the rebate will depend on your level of income. You will receive a statement from your private health insurer, which is required to complete their tax return.

You may now be eligible for a private health insurance rebate if you were covered by private health insurance regardless of who paid for the policy. If you are covered as a dependent child on a policy, they are not eligible for the rebate, but will not have to pay the Medicare levy surcharge.

Medicare levy surcharge thresholds

The Medicare levy surcharge is now determined by new income thresholds. There is no change to how the Medicare levy surcharge applies, or to any exemptions that may apply to your circumstances.

The family threshold will increase by $1,500 for each dependent child after the first.

Dependant tax offsets

There are changes to what you can claim for certain dependants:

• If your spouse was born on or after 1 July 1952, they can no longer claim a dependent spouse tax offset for them at item T1.
• You can only claim the housekeeper and child housekeeper tax offsets if you are eligible for a zone or overseas forces tax offset at item T5.
• If you are not eligible for a zone or overseas forces tax offset, you may be entitled to claim the new dependant (invalid and carer) tax offset at item T7 for a
  • spouse born on or after 1 July 1952
  • parent
  • parent-in-law
  • invalid relative.

To be eligible for the new offset your dependent must receive a government payment as an invalid or carer or be caring for someone who receives a government payment as an invalid.

Net medical expenses tax offset

The amount of net medical expenses tax offset you can claim now depends on your level of income.

You can only claim an offset of 10% of your net medical expenses over $5,000 if you have an adjusted taxable income (ATI) above:

• $84,000 if they are single
• $168,000 if they are a couple or family.

The family threshold will increase by $1,500 for each dependent child after the first.

If your ATI is below these income thresholds, you are not affected by this change and can continue to claim an offset of 20% of your net medical expenses over $2,120.

Mature age worker tax offset

The eligibility test for the mature age worker tax offset has changed. From 1 July 2012, this tax offset is only available to taxpayers born before 1 July 1957.

A full list and overview of these key changes together with an item-by-item description of changes to tax return publications can be accessed in the Tax Time 2013 publication.