Federal Budget 2022

Financial Planning | | 2 min read

The Federal Government recently released their 2022-2023 Federal Budget. While there were no major announcements affecting super and retirement savings, we’ve summarised some of the key points that may be important for you and your family. 

For those looking to downsize 

  • The minimum eligibility age for downsizer contributions will be reduced from age 60 to age 55 – increasing the number of Australians eligible for these contributions. This would take effect from the start of the first quarter after the legislation has passed. 
  • The proceeds from the sale of the principal home are currently exempt from pension asset testing for 12 months. This exemption will be extended to 24 months from 1 July 2022. 
  • This effectively gives pensioners more time to purchase, build or renovate a new home, before it impacts their pension. Changes are effective from 1 July 2022. 

For pensioners who are working

  • Age pensioners and veterans pensioners will receive a once-off credit of $4,000 to their Work Bonus income bank. 
  • Meanwhile the temporary income bank top up will increase the amount pensioners can earn. In 2022–23 the top up will increase from $7,800 to $11,800, before their pension is reduced. 
  • As a result, more pensioners will earn mandatory super (subject to age-based work tests), particularly since the $450 earnings threshold was removed. Changes are effective from 1 July 2022. 

…and for all pensioners 

  • The income threshold for the Commonwealth Seniors Health Card will increase as follows:  

(i) from $61,284 to $90,000 for singles 

(ii) from $98,054 to $144,000 (combined) for couples. 

  • Social security deeming rates will be frozen at current levels for another two years until 30 June 2024. 

Paid parental leave expanded 

  • In changes to the Paid Parental Leave Scheme, from 1 July 2023 either parent will be able to claim the payment. In addition, birth parents and non-birth parents are allowed to receive the payment (eligibility criteria apply). 
  • Parents will be able to claim weeks of the payment concurrently so they can take leave at the same time. 
  • From 1 July 2024, the scheme will expand by two extra weeks a year, until it reaches a full 26 weeks from 1 July 2026. 

Cheaper child care 

  • The maximum Child Care Subsidy rates for families earning less than $530,000 with children in care will be lifted from 1 July 2023. 
  • Also from 1 July 2023, families with First Nations children will be eligible for a base entitlement of 36 hours per fortnight of subsidised early childhood education and care, regardless of activity hours or income level. 

The new Housing Accord 

A new national Housing Accord will bring together states and territories, the Australian Local Government Association, investors, and representatives from the construction sector. 

Key elements of the Accord:  

  • Aspirational target of one million new homes under a national Housing Accord.  
  • Delivered over 5 years from mid 2024. 
  • Government will provide $350 million over 5 years, with ongoing availability payments over the longer term, to deliver an additional 10,000 affordable dwellings. 
  • States and territories will also support up to an additional 10,000 affordable homes, increasing the dwellings that can be delivered under the Accord to 20,000. 

If you’d like more detail, you can read the full Budget at budget.gov.au

We're here to help

If you'd like a more detailed discussion about these changes and how they may affect your circumstances, our financial planners are here to help. 

You can book an appointment online, or call us on 1800 065 753. Your first financial planning appointment is at no extra cost - it's all part of your membership

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