New Financial Year, New Legislation

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Changes To Legislation

With a new financial year there’s often changes to national and/or state legislation. Although there are some changes that can go unnoticed, there are many impactful changes that will affect your business operations. Below, we’ve listed 2022’s key legislative changes that are likely to affect small businesses, sole traders and partners. For more information, refer to the ATO website or, speak with your accountant.

WA’s minimum wage increase of 5.2%

WA’s minimum wage increase of 5.2% ($21.38 per hour) has taken effect since July 1st, 2022. This accounts to approximately an extra $40 per week based on a 38-hour week for a full-time employee. 

  • For minimum award wages above $869.60 per week, employees will receive a 4.6% increase.
  • For minimum award wages below $869.60 per week, employees will receive a $40 increase.

Super guarantee will rise from 10% to 10.5%

Super guarantee will rise from 10% to 10.5% with the super guarantee eligibility threshold removed.

  • This .5% increase is planned every year until super reaches 12% in 2025. This rise aims to offset financial pressure on the Age Pension and improve the financial situations at retirement.
  • Note: businesses only need to pay super for workers under 18 when they work more than 30 hours in a week.

State-wide ban on single-use plastics

  • This development aims to combat the production of plastics and reduce their harm on the environment. 
  • ​​The National Retail Association has been working with the WA Government to prepare businesses for the ban for the 2022 financial year. 
  • Businesses who continue to use single use plastics will be fined $5000 per offence. 
  • The Stage 2 ban is planned to commence January 1st 2023. Stage 2 includes the ban of plastic produce bags, coffee cups, lids for food and drink containers, polystyrene packaging, microbeads, cotton bud sticks, and oxo-degradable additives.

Interaction of tax depreciation incentives

  • This was a measure that was introduced in 2020, to help businesses recover from the impacts of COVID-19.
  • You can only select one incentive for tax depreciation per asset. See here for the order of the incentives.

Temporary full expensing

  • Eligible businesses are able to claim an immediate deduction for the business portion of the cost of an asset for the 2022-23 income year.
  • To check your eligibility, refer to the ATO or contact your accountant.

Instant asset write-off

Since March 2020, there have been changes to the instant asset write-off.

  • The threshold amount for each asset is up to $150,000.
  • Eligibility was expanded to cover businesses with an aggregated turnover of less than $500 million.
  • Increased small business income tax offset, which applies to small businesses, sole traders and partnerships.
  • For 2021-22 for small businesses with turnover less than $5 million, the rate offset is: 16% from 2021-22.
  • It’s important to note that the maximum offset for small businesses is $1,000

Location allowance for regional towns

  • Location allowance for regional towns – only relevant to the WA state industrial relations system – sole traders, unincorporated partnerships, unincorporated trusts and some incorporated not for profit organisations. 
  • Employees that are located in certain regional towns, you might be required to pay a location allowance to compensate for the additional cost of living, climatic disturbances and isolation.

Compensation cap

High income threshold and compensation cap.

  • From 1 July 2022, the high income threshold is set by the Fairwork Commission at $162,000 with the compensation cap at $81,000.
  • When an employee earns more than the high income threshold, the relevant award doesn’t apply and are no longer eligible to apply to unfair dismissal claims through Fair Work.

End of unpaid pandemic leave in awards

  • Unpaid pandemic leave provisions in awards stop applying after 30 June 2022. Previously, employees could access up to 2 weeks’ pandemic leave. Now, employers and employees need to consider other options.

Speak to your accountant

This is only a small snapshot of the 2022/23 financial year changes. We recommend consulting with your accountant on what changes will affect you and your business. Additionally, you can refer to government sites for helpful resources. You don’t want any unexpected surprises when tax time rolls around!

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