Budget 2017 – Things employers of expats need to know | KPMG | AU

Three things employers of expatriates need to know about #Budget2017

Budget 2017 – Things employers of expats need to know

Daniel Hodgson, Hayley Lock, and Caroline Hickson emphasis Budget matters for employers of expatriates.


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Federal Budget 2017: Global Mobility

#Budget2017 might have been a fizzer for some, but if you are a global mobility program manager here are three things you need to know:

1. The bad news

Levy on visa sponsors for Skilling Australians Fund

From March 2018, large businesses will have:

  • an upfront payment of $1,800 per year per employee on a Temporary Skill Shortage visa (the replacement for the subclass 457)
  • a one-off levy of $5,000 for each employee sponsored for permanent residence.

2. The good news... well, for a while...

Tax rate changes

The Temporary budget repair levy (TBRL) ends on 30 June 2017. Changes to balance sheets are required from 1 July 2017. Fringe Benefits Tax (FBT) rates have already been adjusted back to 47 percent.

Hot tip: the removal of the TBRL will likely offset the increased costs for visas for inbounds.

The Medicare levy will increase from 2 percent to 2.5 percent from 1 July 2019. Changes to balance sheets are required from this date. FBT rates will be adjusted to 47.5 percent from 1 April 2020.

3. The sleeper you might have missed

Changes to taxation of Australian housing

Non-residents and inbound temporary tax residents will be denied access to the capital gains tax (CGT) main residence exemption from 9 May 2017. Existing properties will be grandfathered until 30 June 2019. This exemption has been one of the key considerations influencing the decision to rent out a home while on assignment.

There has also been a reduction of the threshold for withholding tax (12.5 percent) on real property sales by non-residents from $2m to $750k. This will bring more Australian outbound assignees in scope of these provisions.

It’s important to get in front of these changes – communicate quickly and clearly with your key stakeholders and let us know if you need a hand preparing or reviewing comms.

Federal Budget 2017

Federal Budget 2017

KPMG's Federal Budget analysis provides commentary into the impacts for the nation and implications for business, industries and sectors.

Tax Insights

KPMG Australia's analysis of tax issues and developments.

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