The Federal Budget is one of the biggest drivers of the nation’s migration policy. Here’s a quick run through of how the latest Budget initiatives are expected to affect Australian run businesses and visa holders.
The Impact on Businesses
At present any business which employs 457 visa holders (changes to 457 Visa) has to invest in the training of their Australian employees as part of their agreed sponsorship obligations. However, from March 2018 all businesses will be required to contribute to the Government’s new “Skilling Australians Fund” which it is anticipates will generate $1.2 billion in revenue. The level of contribution required will depend on the number of visa holders employed, and the overall size of the given business: Small businesses (Turnover: $10m or less)
- Temporary visa holders: $1,200 per visa per year
- Permanent visa holders: $3,000 as a one-off payment per employee
Medium & Large businesses (Turnover: $10m or more)
- Temporary visa holders: $1,800 per visa per year
- Permanent visa holders: $5,000 as a one-off payment per employee
Any business without a formalised training program may well discover that the new fund contributions help facilitate a more efficient method of sponsoring visa holders. Others will need to assess how the commencement of the fund will impact existing training budgets. In addition, plans have now been laid out for the government to increase visa application charges when the Temporary Skill Shortage (TSS) visa replaces the existing 457 visa in March 2018:
- A primary applicant for a 2 year visa will be charged $1,150
- A primary applicant for a 4 year visa will be charged $2,400
The Outlook for Foreign investors
The new Federal Budget outlined a number of changes to Australia’s foreign resident Capital Gains Tax (CGT):
- Foreign investors are to be granted access to the CGT regime for the first time from 9 May 2017, although some exceptions may apply
- The CGT rate for withholding that is applicable to all foreign tax residents will be increased from 10% up to 12%
- In addition the CGT withholding threshold is to be reduced from $2million to $750,000 as of 1 July 2017
- A new principal asset test now applies to all foreign tax residents who have any indirect interests in Australian property, and they will therefore now be liable for CGT
- Foreign investors who neither occupy nor lease Australian properties for a minimum of 6 months in a given year are now required to pay a Foreign Investors Tax Levy of $5,000 each year
Parents of Migrants
For those who wish their parents to come to stay in Australia, a new temporary sponsored parent visa is to be introduced with numbers capped at 15,000 per year. This is an attempt to improve on previous parent visa programs, which proved both costly and time consuming to process and complete. Key components of the new visa include:
- Parents can now be sponsored for a period up to 3 – 5 years, with options available to extend this to a total of 10 years
- Acting as the sponsor, the child will be responsible for the payment of all of their parent’s health care costs for the duration of their stay
- The new visa will be rolled out in November 2017
Need visa advice for Australia? Speak to a Registered Migration Agent at enquiries@my-oe.com for Visa advice and more.
