As Australia approaches the start of the 2025–26 financial year, a series of significant changes are set to take effect from 1 July. These updates will impact millions of Australians—employees, families, retirees, and business owners alike. Here’s a comprehensive guide to the key changes in wages, superannuation, Centrelink payments, and more.
National Minimum Wage and Award Wage Increases
From 1 July, Australia’s lowest-paid workers will benefit from a 3.5% increase in the National Minimum Wage. The new rate will be $24.95 per hour, or $948 per week based on a standard 38-hour week.
This increase, determined by the Fair Work Commission, also applies to minimum award wages and will be effective from the first full pay period starting on or after 1 July. More than 2.6 million workers are expected to see a boost in their pay, offering much-needed relief amid ongoing cost-of-living pressures.
Superannuation Guarantee Rises to 12%
A major milestone in retirement savings arrives as the superannuation guarantee rate increases from 11.5% to 12%. This is the final scheduled rise in a series of annual increments since 2021. Employers must apply the new 12% rate to all salary and wages paid to eligible workers from 1 July, regardless of when the pay period started.
For a worker earning $100,000 annually, this means an extra $500 per year added to their super, potentially increasing retirement savings by more than $47,000 over a 30-year career.
New Superannuation Tax for High Balances
From 1 July, individuals with superannuation balances above $3 million will face an additional 15% tax on earnings attributable to the excess amount, bringing the effective tax rate to 30% for that portion. This change targets less than 1% of super account holders and includes both accumulation and pension accounts.
Notably, unrealized gains will also be taxed under the new rules, and the $3 million threshold will not be indexed for inflation.
Centrelink Payments and Age Pension Changes
Millions of Australians relying on Centrelink payments will see a 2.4% increase to help offset rising living costs. Family Tax Benefit Part A will rise to $227.36 per fortnight for children under 13, and to $295.82 for those 13 and over.
Part B will increase to $193.34, or $134.96 for families with a youngest child aged five or over. Income and asset test limits for the age pension and other payments will also rise by 2.4%, allowing more people to qualify or receive higher payments.
Paid Parental Leave and Superannuation Contributions
Paid Parental Leave is being extended from 22 weeks to 24 weeks for babies born on or after 1 July. For the first time, superannuation contributions at the new 12% rate will also be paid on government-funded Parental Leave Pay, supporting parents—especially mothers—in building long-term retirement savings.
Business Fees and Tax Changes
Business owners will notice increases in ASIC registration and renewal fees, as well as company annual review costs. Additionally, from 1 July, tax deductions for ATO interest charges (such as General Interest Charge and Shortfall Interest Charge) will no longer be permitted, making tax debts more expensive for small businesses.
Energy Bill Relief and Other Cost-of-Living Measures
Eligible small businesses will receive up to $150 in electricity rebates, automatically applied in two $75 quarterly installments. Meanwhile, Medicare Levy Surcharge thresholds are increasing to $101,000 for singles and $202,000 for families, potentially affecting high-income earners without private hospital insurance.