Superannuation (Super) Guarantee Rate
The Super Guarantee Rate, which mandates the minimum percentage of an employee’s earnings that employers must contribute to their super fund, is set to change periodically.
On 1 July 2025, the superannuation guarantee contribution rate will increase from 11.50% to 12.00%. This is the minimum super amount you must pay all eligible employees from 1 July 2025.
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Income Tax Rates
The Australian government has confirmed that individual income tax rates and thresholds introduced on 1 July 2024 will remain unchanged for the 2025-26 financial year. These rates will continue to apply to all taxable income you earn from 1 July 2025.
As a reminder, from 1 July 2024, these changes took affect:
- Reduced the 19 per cent tax rate to 16 per cent
- Reduced the 32.5 per cent tax rate to 30 per cent
- Increased the threshold above which the 37 per cent tax rate applies from $120,000 to $135,000
- Increased the threshold above which the 45 per cent tax rate applied from $180,000 to $190,000
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Resident Tax Rates 2025-26
Taxable Income Tax Payable
$0 – $18,200 Nil
$18,201 – $45,000 16c for each $1 over $18,200
$45,001 – $135,000 $4,288 plus 30c for each $1 over $45,000
$135,001 – $190,000 $31,288 plus 37c for each $1 over $135,000
$190,001 and over $51,638 plus 45c for each $1 over $190,000
The above rates do not include the Medicare Levy of 2%
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Keep Your Accounting Software Up To Date
Keeping accounting software updated is crucial for incorporating changes like new tax rates and super guarantee rates effective from July 1, 2025.
Automatic updates usually handle these adjustments effectively, but it’s prudent to double-check:
- Software Updates: Make sure your accounting software is consistently updated to the latest version. Pay particular attention to updates specifically related to tax and super rate changes.
- Employee Settings: Verify that employee settings in your software are properly configured. This ensures that super guarantee rate calculations are in line with the latest requirements.
- Compliance: Ensuring compliance with super guarantee rate increases is crucial. Confirm that your software accurately incorporates these changes in pay runs to avoid any compliance issues.
By following these steps, you can help ensure smooth payroll operations and compliance with the latest regulatory requirements.
If you would like to discuss how this change affects your business, please contact your Stable Financial accountant, or call us on +61 3 9629 3023.