No.25: Federal Budget Summary 2014

Download the Tax Bulletin – Federal Budget Summary 2014

The Federal Budget for 2014/15 was handed down by the Treasurer, Mr Joe Hockey, at 7.30 pm (AEST) on 13 May 2014.


The key tax and superannuation highlights from the Budget are summarised below. A detailed Chartered Accountants summary can be found at the link above.

Individuals and families

  • The introduction of a 2% budget deficit levy for three years from 1 July 2014 on incomes over $180,000
  • Together with the 0.5% increase to the Medicare levy from 1 July 2014 to fund the National Disability Insurance Scheme, this will take the top total tax rate to 49%
  • An increase to the Medicare levy exemption low-income threshold for families (but not singles)
  • Medicare levy surcharge and private health insurance offset thresholds to be frozen for three years from 1 July 2015
  • Family Tax Benefit payment rates to be frozen for two years from 1 July 2014 and the Family Tax Benefit Part B primary income earner threshold to be reduced from $150,000 to $100,000 from 1 July 2015
  • Individual taxpayers to receive a Tax receipt from 1 July 2014 providing information as to where and how their taxes were used
  • Dependant Tax Offsets and Mature Age Worker Tax Offset to be abolished from 1 July 2014


  • Company tax rate to decrease by 1.5% (to 28.5%) from 1 July 2015
  • Fringe Benefits Tax rate to increase to 49% from 1 April 2015 to 31 March 2017
  • Fringe Benefits Tax exempt benefit caps to be increased for employees in the public benevolent institutions and eligible not-for-profit sectors (rather than reduced or abolished as predicted in the lead up to budget)
  • Various changes with respect to Multiple Entry Consolidated Groups under the consolidation regime not to proceed but changes to Consolidation integrity measures to be refined
  • Small business write-off of assets under $6,500 threshold still unclear (Government intended this be reduced to $1,000 with the repeal of the Mineral Resources Rent Tax which was defeated in the Senate)
  • The proposed new tax regime for Managed Investment Trusts to be deferred to 1 July 2015
  • Research and Development Tax Offsets to be reduced by 1.5% to 43.5% for the refundable offset from 1 July 2014 (one year earlier than the reduction in the company tax rate)
  • Subsidy for employers to employ over age 50 employees who have been previously unemployed for more than six months (up to $10,000 if the employee remains with employer for at least two years)
  • No changes to the complex Employee Share Scheme tax rules


  • Individuals to be given option of withdrawing superannuation contributions in excess of the non-concessional contributions cap from 1 July 2013 together with the earnings on those contributions (with the earnings to be taxed at the individual’s marginal tax rate)
  • Superannuation Guarantee rate to increase to 9.5% (up from 9.25%) from 1 July 2014 and left at this rate until 30 June 2018 (a pause at 9.25% had been previously announced)

Other taxes

  • Fuel excise to rise by re-introducing biannual indexation
  • National Rental Affordability Scheme to end
  • HECS and HELP (Higher Education funding schemes) changes including reduction to income thresholds
  • First Home Saver Accounts Scheme to be abolished from Budget night

Download the Tax Bulletin – Federal Budget Summary 2014