Wednesday, May 12, 2010

Federal Budget impacts on First Home Buyers

Last night, the Federal government handed down their election budget and naturally, this will impact the housing market across the country. You can read more from the NAB's analysis of the budget here but some of the main areas that will be affected include -

  • First Home Saver Accounts - No longer required to abstain from buying a house until the end of four years. Once legislation is passed, you will be able to use the balance of your first home saver account to put towards a mortgage at any time.
    • Make sure you wait until the legislation is passed before buying the house! 
  • 50% off tax on Interest income - Government is encouraging people to save by giving them a 50% discount on their tax on interest income from savings accounts. Sounds good but
    • It only starts from 1 July 2011 
    • Applies to only first $1000 of your interest income
    • And only if this legislation is passed
  • Less time on tax returns - If your tax return is quite straightforward, you can opt to get a $500 tax deduction and not have to prove your deductions.

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