EOFY – What Lies Ahead

What does the onset of a new financial year mean for you? From July 1 new legislation came into effect that will impact on the wallets of millions of Australians, including the raising of the minimum wage, increased superannuation payments, increased Centrelink benefits, and tax off-set payments. Below is a basic summary of what you need to know as we enter FY22-23.

From July 1 Australia’s minimum wage has risen to $21.38 per hour, following a decision by the Fair Work Commission to raise wages by 5.2 per cent. This equates to a $40 weekly pay rise for millions of workers.

Increase to superannuation: employers are now required to make superannuation guarantee contributions to their eligible employee’s super fund regardless of how much the employee is paid. Previously no super was required for employees earning less than $450 per month; this threshold has been scrapped. The super guarantee rate will also increase from 10 per cent to 10.5 per cent for all employees eligible to receive superannuation.

Increase in Centrelink payments: more than 1.4 million Australia families will see an increase to family payments with Family Tax Benefit Part A increasing by up to $204.40 per year for families with a child under 13 years, and $255.50 for those with a child 13 years and over. Family Tax Benefit Part B will increase up to $161.25 per year for families who have a youngest child under five and $116.80 per year for those whose youngest child is aged five to 18.

Around one million pensioners will also benefit from increases in means test free areas, limits and deeming thresholds. The amount of income or assets an Age Pension, Disability Support Pension, or Carer Payment recipient can have before their payment is affected will also increase.

Over 10 million Australians will become eligible for a one-off $420 cost of living tax offset. When combined with the low and middle-income tax offset (LMITO), eligible low and middle-income earners will receive up to $1,500 for a single income household, or up to $3,000 for a dual income household. These payments will land in people’s bank accounts when their tax returns are paid to them.

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