K-Rudd’s $12.7bn Stimulus Package

Kevin Rudd last night announced that the Australian government will once again be handing out money to low-middle income earners to help bolster the economy and weather the storm so to speak, encouraging spending and to help secure 90,000 jobs from being lost.

Workers, students and drought-stricken farmers will be showered with $12.7 billion in cash payments to provide short-term stimulus to the flagging economy. Source: The Australian

The Australian Tax Office is currently doing work in preparation for an April deposit into bank accounts for individuals as well as families who fall into the income bracket <$80,000. This group will receive the $950 as promised, and I believe that higher income earners will also receive something too, but not as large (in the order of $200-$300).

So look out for an increase to your bank account around April.

15 thoughts on “K-Rudd’s $12.7bn Stimulus Package”

  1. Hey JD…

    This $950 payment gets a little more complicated – Apparently in testing eligibility the ATO will look at individuals lodged 2008 income tax returns and apply the $950 as a tax offset. Basically this means that if you paid tax in 2008 (after other offsets and credits), the government will return $950 of that back to the taxpayer. If you didn’t pay tax (because you didn’t work, your income was below the $6000 tax free threshhold, or the low income earner/mature aged worker offsets covered any tax payable on your 08 assessment), you are not entitled to the offset (because there was no tax paid to offset).

    This raises questions in my mind about – what happens to the people who have been working the past 7 months of this financial year that weren’t working in 2008? What happens with all our client’s that still haven’t lodged 2008 returns (many are not due to May 15.. and then an extended lodgement gives us until June 5)? I wish I had time to research it.. but Im sure ill find out in due course.

  2. So… To answer one of my own questions – The tax offset will only be available to those taxpayers who lodge their 2008 income tax return prior to June 30, 2009 (if lodging post June 30, you won’t be entitled). The ATO will roll out payments commencing April to those who have already lodged – and I guess they will review remaining 2008 returns as they are lodged until June 30.. and forward the $950 payments in due course.

    Also, if taxpayers have a current tax liability with the ATO.. apparently the $950 will not be withheld by the tax office to reduce the taxpayers tax debt. Very cool indeedie.

    Anyways.. this is way too much information… but im sure it’s interesting to someone out there (as it is to me 😀 ) hehehe.

  3. so, i lodged my tax in october does this mean i will miss out? My husband aslo lodged then.
    I worked part time but earned more than the tax 6,000 low income………..confussed.
    If so will we get 950.00 each or only one payment for the main income earner.

  4. Rea:

    I don’t think you’ll have a problem. So long as you actually lodged your 2007-2008 tax return you will be eligable for the bonus.

    Although, since I wrote this post the government have revised this bonus payout to between $50-$900. Still better than nothing.

  5. Rea:

    As long as you lodge your 2007/08 income tax return prior to 30 June 2009, you will receive the $900 payment (if entitled). If you lodged in October 2008, you definitely meet the lodgement requirements.

    As for your entitlement to actually receive the $900 – Just because you earned above the $6,000 tax free threshhold doesn’t make you automatically eligible for the payment. In order to receive the payment you must have paid tax.

    If you earnt between $6,000 and around $11,000, the low income earners offset offsets the tax payable and any tax you may have paid on the 11,000 via wages withholding etc would have been returned to you by way of refund. Generally, it’s not until you earn in excess of roughly $11,000 that you become eligible to receive the payment or part of the payment (depending on the amount of tax actually paid). Even then, you may have had other offsets and credits such as mature aged workers offset, franking credits and so on that offset your tax liability therefore making you ineligible.

    Basically it’s too hard to give a yes or no answer considering the variables and lack of information re: your tax position. Your tax estimate attached to the front of your 2008 income tax return or 2008 notice of assessment issued by the ATO should provide all details you need to calculate how much tax you paid and therefore, your entitlement. My advice is to either consult your tax agent or refer to the Australian Taxation Office website: http://www.ato.gov.au which should give you guidence on how to compute your entitlement.

  6. If we are eligible for the stimulus payment and only receive our FTB at tax time in a lump sum do we still receive the money now or at tax time? The reason I ask is because the $1000.00 at xmas was done this way so the Xmas bonus we don’t get till June 30

  7. I am now a full time uni student and i am not on aus study or youth allowance! last year i earnt over the $6000 threshold yet i think i got it all back am i still eligiable for the bonus!

  8. I am currently working as it is my fist year out of high school. I did my tax return last year. But did not earn at least $6000 does that mean I won’t be getting the 900?

  9. I am currently working as it is my first year out of high school. I did my tax return last year. But did not earn at least $6000 does that mean I won’t be getting the 900?

  10. Ok. $6000 is not the minimum you have to earn!!
    Because of the low income tax offset, effectively the minimum you have to earn is around $14000.
    People should look up this offset, especially before giving advice on here.

  11. well i think this is all confusing iv been told so many different stories…i was told that you only get it if you were part time or full time which i wasnt i was only casual at the time but i did earn over $6,000 within 07/08…..can i still get it?

  12. i think you have to had paid tax (didn’t receive all taxable income back) in order to receive the payment
    im 17 i earned over 6000 paid bout 800 tax but i got it all back and all my friends over 18 have got it, which i think once u turn 18 u actually don’t get all ur tax back, which, in turn, is paying tax i reckon haha and i havn’t received anything yet 😦 but i hope my theory is wrong lol coz i want my money and i want it now XD

  13. I earned under $6000 as I worked off and on, but i paid more than $0.00 tax as I didn’t tick the ‘tax free threshold’ box or whatever. I got tax money back as well.
    Am I entitled… I haven’t recieved it yet. If not, there’s something seriously wrong with the system..

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