As we step into the new financial year, it’s crucial to stay informed about the significant changes to taxes and superannuation that impact all taxpayers and businesses. Here at Nationwide Financial, we are committed to helping you navigate these updates and maximise your financial benefits.
Key Tax Changes
From 1 July 2024, tax cuts are in effect, reducing the 19% tax rate to 16% and the 32.5% rate to 30%. The 37% rate now applies to incomes above $135,000, up from $120,000, while the 45% rate kicks in at $190,000, previously $180,000. These adjustments aim to protect against bracket creep and lower average tax rates.
Superannuation Updates
The Super Guarantee (SG) rate has increased from 11% to 11.5%, with a further rise to 12% in July 2025. Contribution caps have also been adjusted, with concessional caps rising to $30,000 and non-concessional caps to $120,000. The bring-forward rule now allows contributions up to $360,000 over three years.
Medicare Levy Thresholds
Changes from the May 2024 Federal Budget have raised the low-income threshold for the Medicare Levy to $26,000, ensuring continued exemption or reduced rates for low-income earners.
Implications for Employers
Employers must update their payroll systems to reflect the new PAYG withholding tax rates. Additionally, unincorporated businesses benefit from the new individual tax rates.
Strategic Considerations
With extra disposable income due to tax cuts, consider strategies like increasing super contributions or paying down non-deductible debts. However, note the potential impact on salary packaging arrangements.
Expert Guidance
Navigating these updates can be complex. Our team at Nationwide Financial is here to provide expert advice tailored to your specific financial situation. Whether it’s understanding new tax rates, adjusting super contributions, or optimising salary packaging, we’re here to help.
Contact us today to ensure you’re making the most of the new financial year’s opportunities.