There has been some confusion regarding the recent changes to the Low and middle income tax offset, some of our clients are under the impression that everyone will receive an addition $1,080 in their tax refund... this is not case.
The amount of the low and middle income tax offset you're entitled to depends on how much you earn, and how much tax you've already paid. If your taxable income:
- is $37,000 or less, you may receive an offset of up to $255
- is more than $37,000 but less than $48,000, you may receive $255 plus an amount equal to 7.5% to the maximum offset of $1,080
- is more than $48,000 but less than $90,000, you may be eligible for the maximum offset of $1,080
- exceeds $90,000 but isn't more than $126,000, you may be eligible for an offset of $1,080 less an amount equal to 3% of the excess.
The offset will reduce the amount of tax you pay on your taxable income. It's a non-refundable tax offset, so you can't receive a refund for any unused amount.