The new financial year commencing July 1 brings sweeping changes for Australian workers and businesses, including tax cuts, superannuation paid on payday, a minimum wage increase, expanded parental leave, and new anti-scam text message regulations.
Modest tax cuts for low-to-middle earners
From July 1, the lowest income tax rate, applicable to earnings between A$18,201 and $45,000, will drop from 16% to 15%. A person earning $45,000 or more will save $268 annually.
New instant $1,000 work-related tax deduction
The federal government has proposed an “instant” $1,000 work-related tax deduction, pending parliamentary approval. This is higher than the existing $300 receipt-free deduction. It is forecast to benefit about 6.2 million Australians. However, those who claim more than $1,000 in work expenses are advised to continue collecting receipts and claiming as before.
National minimum wage increase
Around 2.8 million low-paid workers will receive a 4.75% pay rise from July 1. About 100,000 workers on entry-level and minimum pay will get a larger 5.97% increase. The national minimum wage will rise from $24.95 per hour to $26.44, or from $948 per week to $1,004.90. Despite these increases, Australia's lowest-paid employees will still have less purchasing power than five years ago.
Payday super: superannuation paid with wages
From July 1, all businesses must pay employees' superannuation on the same day as salaries. This is expected to leave ordinary workers thousands of dollars better off in the long term and address the persistent problem of underpaid super.
Parental leave pay changes
Paid parental leave will increase by ten days to a total of 26 weeks from July 1, with the weekly payment rising to $1,004.70. The government says this will provide more financial support, though parents must still meet income and work tests.
Instant asset write-off extended for small businesses
Small businesses with annual turnover under $10 million can permanently claim an instant write-off for assets costing less than $20,000 from July 1.
SMS register to fight scams
From July 1, scam text messages will appear under a single “unverified” message thread. Businesses and community groups that have not registered their legitimate sender ID by July 1 risk having their messages end up in that thread. This move aims to combat fake sender IDs used by scammers.
Supermarket price-gouging law
A new law from July 1 increases scrutiny on pricing practices of Coles and Woolworths, following similar EU rules. Penalties apply for breaches, though “excessive pricing” may be difficult to prove.
Anti-money laundering rules widened
Updated anti-money laundering and counterterrorism financing (AML/CTF) rules will apply to real estate professionals, lawyers, accountants, conveyancers, and some other businesses from July 1. They must register with AUSTRAC, verify customer identities, and report certain transactions.
What’s not changing from July 1
Proposed changes to negative gearing and the 50% capital gains tax discount from the May budget are not yet law and are due to begin July 1, 2027. A new minimum tax on discretionary trusts is not due until July 1, 2028. The Working Australians Tax Offset of $250 per year starts from July 2027.
