Australia is set to introduce a series of changes starting July 1, 2025, that will impact workers, retirees, and families across the country. One of the most significant changes is the increase in the superannuation guarantee from 11.5% to 12%. This marks the final step in a gradual series of increases that began in 2012 under the Rudd-Gillard Labor government.
According to the Association of Superannuation Funds of Australia (ASFA), this increase could add tens of thousands of dollars to the average super account by retirement. For example, a 30-year-old earning $60,000 could see an additional $20,000 in their superannuation. ASFA chief executive Mary Delahunty said, “The system foundations are cemented for young, working people to have a comfortable retirement.
It’s a moment all Australians should be proud of.”
However, the cost of a comfortable retirement has also increased by 1.6% in the past year, while the cost of a modest retirement rose by 1.7%. On average, couples need $73,900 annually for a comfortable retirement, while singles require $52,300. Delahunty emphasized the importance of increasing Australia’s housing stock to mitigate retiree financial pressures.
In addition to the superannuation changes, new parents in Australia will also receive a boost. Starting July 1, parents with babies born or adopted will receive an additional superannuation payment at 12% of their parental leave pay.
Superannuation increase impacts all Australians
This could result in nearly $3,000 extra in superannuation, which UniSuper senior private client adviser Melinda Brown said could make a “huge difference” over time. The paid parental leave is calculated based on the minimum wage, which will increase by 3.5% to $24.95 per hour, or $948 per week, on July 1. This move is predicted to improve the financial situation of around 180,000 Australian families each year.
Foreigners residing in Australia will also see significant changes. The National Minimum Wage will rise by 3.5%, bringing it to AUD24.95 per hour. Award minimum wages will also see a 3.5% increase, affecting most employees across various industries.
For visa holders, several income thresholds are set to increase, including the Temporary Skilled Migration Income Threshold (TSMIT) and the Core Skills Income Threshold (CSIT). Business owners will also be impacted by the changes. Small businesses will no longer be able to claim tax deductions on ATO interest incurred on or after July 1, 2025.
Additionally, registration costs for business names, company registration, and annual review fees for proprietary companies will all increase. These comprehensive updates signify Australia’s commitment to adjusting its economic landscape to better accommodate workers, families, and foreign residents while maintaining a thriving, competitive market.
