Tax cuts, super increases and Centrelink payment boosts are among the money changes kicking in today. ·Source: Getty/Yahoo Finance Australia
The new the financial year is officially here and that means a ton of changes are kicking in for Aussies. From July 1, there are new rules that will affect almost everyone including individual taxpayers, families and retirees.
All Aussies will see a change to their weekly pay when the stage 3 tax cuts, which were the centrepiece of the government’s federal budget, take effect.
The changes will:
Cut the 19 per cent tax rate to 16 per cent for incomes between $18,200 and $45,000
Cut the 32.5 per cent tax rate to 30 per cent for incomes between $45,000 and $135,000
Retain the 37 per cent tax rate but increase the threshold from $120,000 to $135,000
Retain the 45 per cent tax rate but increase the threshold from $180,000 to $190,000
You don’t need to do anything to get the tax cut. Employers will automatically adjust the amount of tax they take out of your pay. You can see how much you’ll save here.
Do you have a story to share? Contact tamika.seeto@yahooinc.com
Age pension, disability support pension and carer payment recipients will see increases in their income and asset thresholds. That means they will be able to have more income and assets before their payments are affected.
Deeming thresholds will also be indexed. Deeming rates will remain frozen for another year, with a lower bracket of 0.25 per cent and a higher bracket of 2.25 per cent.
The minimum wage and award wages will increase by 3.75 per cent, following a decision by the Fair Work Commission. This will impact about 2.6 million workers.
The minimum wage will increase to $24.10 per hour or $915.90 per week, based on a 38-hour working week.
Superannuation
The super guarantee rate will increase from 11 per cent to 11.5 per cent. This means your employer will be putting a higher percentage of your pay into your retirement nest egg.
The general concessional contributions cap will increase from $27,500 to $30,000 for all individuals. This is the maximum amount of before-tax contributions you can contribute to your super each year without contributions being subjected to extra tax.
The non-concessional contributions cap, which is the maximum amount of after-tax contributions you can make without being hit with extra tax, will increase from $110,000 to $120,000.
Power prices changes will also kick in, with the Australian Energy Regulator revealing that most households and small business customers on standard retail plans will experience price reductions.
Households could see price reductions between 1 and 6 per cent, depending on their region. Meanwhile, Victorian residential customers will see an average reduction of 6 per cent.
Parental leave pay
Parental Leave Pay will be expanded to 22 weeks, up from 20 weeks. Payments are made at the national minimum wage. The amount of leave parents can claim will increase by two weeks until it reaches 26 weeks from July 2026.
This amount is shared between parents. Currently, two weeks of leave are set aside for the second parent who is not using the majority of leave.
Thresholds for the Medicare Levy Surcharge (MLS) will be increasing. This is a penalty you have to pay if you earn over a certain amount and don't have private health insurance. It is up to 1.5 per cent of your income.
Singles who earn over $97,000 and families who earn above $194,000 and don't have to pay health insurance will now have to pay the surcharge, up from $93,000 and $186,000 respectively.
Health insurance
Thresholds for the private health insurance rebate will also be increasing, with savings of up to $770 available. This is a rebate from the government to help cover the cost of health insurance premiums.
Singles who earn up to $97,000 and families who earn up to $194,000 will be able to qualify for the highest rebate of 24.608 per cent, up from $93,000 and $186,000.
The rebate then decreases as you earn more. Singles will be able to earn up to $151,000 and families up to $302,000 to still get a rebate, up from $144,000 and $288,000.
Passports
Aussie travellers will also have more options to fast-track their passports. As announced in the budget, Aussies will be able to pay $100 to have their application processed within five business days. This is in addition to the existing $252 fast-track option, which takes two days.
Passport prices will also be going up, with the cost of getting a 10-year passport increasing from $346 to $397.90 - a price hike of about $50.
NBN price changes
NBN prices are going up today thanks to wholesale price increases of between $2.22 and $2.52 a month.
The exact price hike will depend on your provider with Telstra, Optus, Aussie Broadband, Dodo, Superloop, iPrimus and Exetel among those making changes to their plans.
For example, Telstra is increasing its NBN 25 plan by $4 a month and NBN 50 plan by $5 a month. It's NBN 250 is actually decreasing by $5 a month and NBN 1000 by $20 a month.
