From 1 July 2024, there have been some updates to your super and tax.
Here are four changes that might affect you:
1. The super guarantee has increased to 11.5%
From 1 July 2024, the super guarantee increased from 11% to 11.5%. This is the amount that your employer must contribute into your super account.
The 11.5% super guarantee will begin to apply for earnings (overtime excluded) after 1 July 2024. The first super quarter this rate will apply to will be 1 July 2024 – 30 September 2024.
If you are under 18, you still need to work 30 hours in a week to be eligible for super.
What to check:
- Your payslips for any super earned after 1 July 2024 is calculated at 11.5%.
- Your super account after 28 October 2024 to make sure your super is actually paid into your account.
2. The government co-contribution income thresholds have increased
The government co-contribution scheme is an incentive for individuals to make personal contributions to their super account. The government co-contributes up to 50c for every $1 you contribution, capped at $500. The co-contribution decreases progressively as your income increases.
The lowest income threshold has increased to $45,400 p.a. and highest income threshold has increased to $60,400 p.a. This could mean you’re eligible to receive the co-contribution this financial year!
| Financial Year | Lowest income threshold | Highest income threshold |
|---|---|---|
2024-25 (1 July 2024 – 30 June 2025) | $45,400 p.a. | $60,400 p.a. |
For example, if you make a $100 personal contribution into your super account and you earn below $45,400 p.a., you could be eligible for the best rate of co-contribution. The government will contribute $50 into your super account. This happens automatically when you lodge your tax return.
What to do next:
If you weren’t eligible for the co-contribution before, you could be now! Check your annual salary and see if you can take advantage of this government incentive for the 2024-25 financial year. Additional eligibility criteria applies, see the ATO website.
3. The super contribution caps have increased
The concessional and non-concessional contributions caps will be increasing from 1 July 2024.
| Contribution caps | 2023-24 | 2024-25 |
|---|---|---|
Concessional contributions cap | $27,500 | $30,000 |
Non-concessional contributions cap | $110,000 | $120,000 |
What does this mean for me?
If you’ve made a personal contribution, you could be eligible to claim a tax deduction if the total of your concessional contributions is less than the cap.
For example: if your employer pays you $5,000 in your super account during 2024/25 financial year (1 July 2024 – 30 June 2025), you could be eligible to claim a tax deduction for up to $25,000 of personal contributions.
However, if you choose to claim the government co-contribution, you cannot claim a tax deduction as well.
Read more about personal contributions or for eligibility requirements for tax deductions, see the ATO website.
4. The income tax rates and thresholds have changed
There tax rates will be reduced from 1 July 2024.
- The 19 per cent tax rate will be reduced to 16 per cent
- The 32.5 per cent tax rate will be reduced to 30 per cent
- The 37 per cent tax rate will be apply to a higher income threshold, from $120,000 to $135,000
- The 45 per cent tax rate will apply to a higher income threshold, from $180,000 to $190,000
The new tax rates for FY2024-25 (1 July 2024 – 30 June 2025)
| Taxable income | After 1 July 2024 |
|---|---|
$0 - $18,200 | Tax free |
$18,201 - $45,000 | 16% |
$45,001 - $135,000 | 30% |
$135,001 - $190,000 | 37% |
Over $190.000 | 45% |
See the ATO website for more information. The tax cut calculator is also available here.
This wraps up the changes our summary of changes for this financial year! It’s important to know what might affect your super, income and what incentives you might be eligible for this financial year.