Personal Income Tax Thresholds
From 31 July 2024, Personal Income Tax Thresholds will increase.
| Current Bracket $ | New Bracket $ | Tax Rate |
| 0 – 14,000 | 0 – 15,600 | 10.5% |
| 14,001 – 48,000 | 16,601 – 53,500 | 17.5% |
| 48,001 – 70,000 | 53,501 – 78,100 | 30% |
| 70,001 – 180,000 | 78,101 – 180,000 | 33% |
| 180,001+ | No change | 39% |
Independent Earner Tax Credit (IETC)
From 31 July 2024, the IETC will be accessed by eligible individuals earning between $24,000 to $70,000 per annum. This band has been expanded from the current $24,000 to $48,000.
Those earning between $24,000 to $66,000 will receive the full credit, with entitlements gradually reducing as income increases up to $70,000.
In-work Tax Credit
From 31 July 2024, the IWTC will increase by up to $50 per fortnight. This tax credit is for families with dependent children who are in paid work.
FamilyBoost
From 1 July 2024, parents and caregivers earning up to $180,000 per annum, will be eligible for a partial reimbursement of their ECE fees, up to a maximum fortnightly payment of $150. The maximum entitlement will slowly reduce for families earning over $140,000 per annum.
Also announced in the Budget is the Government’s plan to invest $116m over the next four years into compliance enforcement by Inland Revenue. This is forecast to bring in an additional $702m. The Inland Revenue has been relatively quiet in recent years on the compliance enforcement front so expect to now see an uptick in their efforts in this area.
Additionally, earlier in the year the Government enacted a handful of tax changes which are summarised below:
Trust Tax Rate
The Trust tax rate has increased to 39% from 1 April 2024 unless a Trust earns less than $10,000 net of expenses and beneficiary distributions.
Bright-Line Period
- For properties sold on or after 1 July 2024, the bright-line property rule will only apply if property is sold within 2 years of purchasing it.
- For properties sold before 1 July 2024, the current bright-line periods will continue to apply.
Main-Home exclusion from Bright-Line
The main home exclusion will return to the original test. The bright-line property rule will not apply if:
- More than 50% of the property’s area is used as the main home
- The property is used as the main home for more than 50% of the time it is owned
Interest Limitation for Residential Rental Property
From 1 April 2024, the ability to claim interest deductions will be phased back in, restoring interest deductions to 100% from 1 April 2025.
| Date Interest Incurred | % of interest that can be claimed |
| 1 April 2024 – 31 March 2025 | 80% |
| 1 April 2025 onwards. | 100% |
Depreciation of Commercial Buildings
The ability to claim depreciation for non-residential buildings was reintroduced as part of the COVID economic stimulus measures. From the 2024-2025 income year the depreciation rate will return to 0%.
For more information visit: Inland Revenue or contact our team to discuss.
The comments in this article are of a general nature and should not be relied on for specific cases, where readers should seek professional advice.