There have been a couple of major changes this year that are important and can be claimed on the 2012 return:

No strings Schoolkids Bonus cash payment to replace Education Tax Offset

On 6 May 2012, in the lead-up to the Budget, the Prime Minister announced that the Government would make a new no-strings cash payment, called the Schoolkids Bonus, to certain families with children at school. The announcement was confirmed in the 2012 Budget papers.

It will apply from 1 January 2013, and each year, families will receive the Schoolkids Bonus worth:

• $410 for each child in primary school.
• $820 for each child in high school.

The new automatic payment will replace the Education Tax Refund (or offset) from 1 January 2013. Under the existing system, the PM said 1 million families were not claiming what they were entitled to - either claiming less than the full amount, or claiming nothing at all. That's 80% of eligible families, she said.

According to the Prime Minister, because the payment is automatic and upfront, it means:

• Parents don't need to keep receipts - it's a guaranteed payment.
• Parents will receive the full amount every time, so families won't miss out if they lose receipts.
• Parents don't have to pay out of their own pocket, then wait months to get paid back through the tax system - the payment will be paid upfront, twice a year (in January and July each year), before the start of Term 1 and Term 3
• No paperwork is required.

Confirmed with Treasury that the Schoolkids Bonus will not be a taxable payment.

In the same way as the Education Tax Refund, the Schoolkids Bonus will be available to families receiving Family Tax Benefit Part A plus young people in school receiving Youth Allowance and some other income support and veterans' payments.

As part of the transition to the new Schoolkids Bonus, the Education Tax Refund for 2011-12 will be paid out in full to all eligible families as a lump sum payment in June 2012. The PM said this means families will receive their full Education Tax Refund entitlement ahead of tax time - so parents won't have to worry about keeping receipts or making claims when they do their tax this year.

Low Income Supplement under Clean Energy Scheme

The Budget Papers reminded people that a new Low Income Supplement of $300 would be available to people in low-income households who can show they did not receive enough assistance through tax cuts or other household assistance payments. People may be eligible for the supplement if they have annual adjusted taxable income of less than $30,000 for singles, $45,000 for couples and $60,000 for people with dependent children. To be eligible, people must be able to show that in 2011-12, they were either not required to pay tax or were required to pay tax of less than $300 and that for most of the year, they did not receive another government payment.

People can apply for the payment from 1 July 2012.

... and more

DOWNLOAD Tax Bulletin 2012

* Disclaimer: nothing in this newsletter constitutes advice. If you require specific advice on your situation, please phone our office for an appointment and a confidential discussion of your affairs.

 

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