At Pursue Wealth, we’ve broken down the key changes that may impact your finances, so you can plan with confidence.
1. Tax Cuts Are on the Way
Good news for low-and-middle-income earners: the government is introducing further personal income tax cuts.
- From 1 July 2026, the tax rate for income between $18,201 and $45,000 will reduce from 16% to 15%.
- From 1 July 2027, it’ll drop again to 14%.
These changes are designed to leave more money in your pocket and help with rising household expenses.
2. Higher Medicare Levy Thresholds
From 1 July 2025, the income thresholds for the Medicare levy will increase, which means fewer people will need to pay it. Here’s what’s changing:
- Singles: rising from $26,000 to $27,222
- Families: up from $43,846 to $45,907
- Single seniors and pensioners: increasing to $43,020
- Family threshold for seniors/pensioners: increasing to $59,886
Plus, for each dependent child or student, the threshold will go up by $4,216.
3. HELP/HECS Debt Relief for Students
If you’ve got a student loan, there’s some relief coming your way:
- A one-off 20% reduction in all outstanding HELP and student debts will apply before indexation on 1 June 2025.
- From 1 July 2025, you won’t need to start repaying your loan until you earn at least $67,000 (up from $54,435).
These changes aim to make student debt more manageable and repayments more affordable.
4. More Affordable Childcare
From January 2026, all families will have access to at least three days (72 hours per fortnight) of subsidised early childhood education and care (ECEC), regardless of their activity level. This replaces the existing Child Care Subsidy Activity Test and is designed to support children’s development while easing pressure on working families.
5. Energy Bill Relief
To help households and small businesses cope with rising energy prices, the government will extend the Energy Bill Relief Fund. This includes two $75 rebates off electricity bills through to 31 December 2025—applied automatically.
6. Support for Apprentices and Job Creation
From 1 July 2025, eligible apprentices in housing construction will be able to receive up to $10,000 in financial incentives over the course of their apprenticeship. Employers may also receive a Priority Hiring Incentive of up to $5,000—extended until the end of 2025.
7. Housing Measures
To help ease pressure on the housing market, the government will temporarily ban foreign buyers from purchasing established dwellings for two years starting 1 April 2025, unless the purchase supports increased housing supply or worker accommodation. They are also expanding the Help to Buy Scheme, without about $800 million going towards increasing the eligible property price and income caps to make the scheme more accessible.
What Should You Do Next?
While many of these announcements are positive, it’s important to remember that they’re proposals and need to be legislated before becoming law. If you’d like help understanding how these changes may affect your financial plan, budget, or investment strategy, our team at Pursue Wealth is here to support you.
