A guide to the money changes kicking in from 1 July

The 2025 financial year is around the corner and with it a swath of changes that will impact the finances of taxpayers, retirees and households. For some, it will provide much-needed cost-of-living support while for others it will result in a boost to after-tax income or retirement savings. We look at some of the major changes kicking in from 1 July and how they may impact you.  

New marginal tax rates 

From 1 July new marginal tax rates will result in lower taxes, with the average worker getting a tax cut of $1,888 over a year or $36 per week. If you are one of the 13.6 million Aussies to benefit you'll receive an increase in your take-home pay.   

Amended marginal tax rates 

Source: treasury.gov.au

To take advantage of the change, you may consider making bigger deductions or prepaying expenses this financial year when the marginal tax rate is relatively higher. Moreover, income such as a capital gain or bonus could be delayed until the next financial year to leave more income in your pocket.   

Tax cut per taxable income band 

Source: treasury.gov.au

Higher Medicare levy surcharge thresholds  

The Medicare levy surcharge (MLS) is an extra levy paid by high-income earners who do not have private health insurance. From 1 July the thresholds for the Medicare surcharge will increase from $4,000 for singles and $8,000 for families which could result in you moving down a level or not paying the surcharge at all. You can see the changes in the tables below.

Medicare levy surcharge for singles

Medicare levy surcharge for families  

Source: ato.gov.au. The family income threshold is increased by $1,500 for each MLS dependent child after the first child.

Superannuation guarantee increased 

Your retirement nest egg will receive a small boost next financial year as the superannuation guarantee rate increases. From 1 July the minimum amount your employer must contribute to your superannuation will increase from 11.0% of your ordinary time earnings to 11.5%.  

Superannuation contribution caps increased 

In addition to the increase in the superannuation guarantee rate, the amount you can contribute to superannuation in a given year will also increase.

The concessional contribution cap will increase from $27,500 to $30,000 from 1 July. Concessional contributions are taxed at 15% and include employer contributions, salary sacrifice payments and contributions where a tax deduction has been claimed.

If your superannuation balance is less than $500,000 you are eligible to carry forward unused concessional contributions on a rolling basis for five years.  

The non-concessional contribution cap will increase from $110,000 to $120,000. Non-concessional contributions typically include personal contributions where a tax deduction is not claimed or spousal contributions.

If you are under 75, you are eligible to bring forward three times the annual concessional contribution cap in a single year.  

Preservation age increased to 60  

Preservation age is an important number as you approach retirement because it determines when you can begin to access your superannuation. From 1 July the age Australians can access their superannuation benefits will increase to 60 and will apply to all Australians born after 30 June 1964. Keep in mind this is different to the age pension qualifying age which is 67.   

There are additional conditions you must meet to access your superannuation at preservation age such as retiring from work or opening a transition to retirement account. From age 65 you can access superannuation even if you haven't retired.  

Preservation ages

Source: ato.gov.au

$300 energy rebate  

The 2024 Federal Budget announced all Australian households will receive a $300 rebate on their electricity bills. The discount will be automatically applied in quarterly instalments from your first bill after 1 July.  

Cheaper energy bills 

The maximum Australian households can be charged on their energy bill will come down after the Australian Energy Regulator released its final Default Market Offer (DMO) for 2024-25. From 1 July, residential customers on standard plans should see their bill fall between 1% to 6% depending on their location.  

For Victorian households, the Essential Services Commission reduced its default offer by 6% for residential customers and 7% for small businesses.  

Keep in mind most retailers have cheaper deals than the standard rate, so it's worth shopping around for a better deal on sites such as Energy Made Easy or Victorian Energy Compare.  

Paid parental leave extended

From 1 July more than 180,000 families will benefit from an additional two weeks of government-funded paid parental leave. This will bring the total paid parental leave to 22 weeks and is part of the government's plan to increase the total leave to 26 weeks by 2026.  

If you have a partner, you are eligible to take 10 days at the same time. You will also have 10 days reserved for each of you to use.  

Paid Parental Leave by financial year 

Source: servicesaustralia.gov.au

Minimum wage increased 

The Fair Work Commission has announced a 3.75% increase to the national minimum wage and minimum award wages. This will result in a new national minimum wage of $915.90 per week or $24.10 per hour from 1 July.  

Higher passport fees   

Australia will claim the unwanted title of the world's most expensive passport when a 15% price increase comes into effect from 1 July. The cost of a 10-year Australian adult passport will increase from $346 to $398, so it's best to check your expiry pronto to avoid paying an extra $54.  

Social Security changes

A raft of indexation and increases to thresholds will take place on 1 July across several social security benefits. Here's a look at some of them.

Pensions and allowances

Increases to the income and asset thresholds for the age pension, disability support and carer payment will mean recipients will be able to earn and own more before their payments are affected. Put another way, if assets and income stay the same, recipients will be eligible for an increased payment.   

Income test: Receive full benefit

Income test: Maximum income before ineligible

Asset test: Receive full benefit

Asset test: Maximum income before ineligible

Source: dss.gov.au

Similar to pensions, the disqualifying asset limit for allowances such as Jobseeker, Youth Allowance and the Parenting Payment will be increased to allow more Australians to qualify for assistance.   

Disqualifying asset limit for allowances 

Source: dss.gov.au

Rental assistance 

The Federal Budget announced a 10% increase to the Commonwealth Rent Assistance scheme. Your level of rent assistance will depend on personal circumstances including how much rent you pay, if you live alone or have children. This measure will begin on 20 September 2024.  

Family Tax Benefits  

Family payments including Family Tax Benefit A, Family Tax Benefit B, Newborn Supplement and Multiple Birth allowance will also be indexed and therefore provide extra income for recipients.  

Family Tax Benefit A: Maximum rate, each child, excluding supplement

Family Tax Benefit B: Maximum rate, each child, excluding supplement

Newborn Supplement, payable over 13 weeks

Multiple Birth Allowance payment per fortnight  

Source: dss.gov.au

For the complete list of changes, you can check out the indexation rates provided by the Department of Social Services.