The new financial year will see several fresh tax cut changes, and also changes to superannuation contribution rules and rates. Let’s have a closer look at what some of these changes may mean for you.
1. Personal Superannuation Contribution caps on the rise
· Concessional Cap – these are set to increase to $30,000 from 1 July 2024
· Non-Concessional Cap – are set to increase to $120,000 1 July 2024
· Non-Concessional Cap bring forward rules – are set to change and be subject to each individuals total super balance from 30 June in previous year
2. Stage 3 tax cuts changes
As per changes announced in January 2024 this will attempt to further address the cost-of-living crisis which will see a reduced tax cut for high income earners and increase cuts for low- and middle-income earners. This takes effect from 1 July 2024.
Current Financial Original Stage 3 New Rates from
Year Changes 1 July 2024
Taxable Income | Tax Rate | Taxable Income | Tax Rate | Taxable Income | Tax Rate |
Up to $18,200 | Nil | $0 - $18,200 | Nil | Up to $18,200 | Nil |
$18,201 - $45,000 | 19% | $18,201 - $45,000 | 19% | $18,201 - $45,000 | 16% |
$45,001 - $120,000 | 32.5% | $45,001 - $200,000 | 30% | $45,001 - $135,000 | 30% |
$120,001 - $180,000 | 37% | $135,001 - $190,000 | 37% | ||
> $180,000 | 45% | > $200,000 | 45% | > $190,000 | 45% |
*Plus Medicare levy of 2%. These tax rates apply to Australian resident taxpayers. Different rates apply if you’re a working holidaymaker or you’re a non-resident for tax purposes
3. Cary forward concessional contribution rules form of age
How does this work?
This will allow taxpayers to carry forward unused concessional cap amounts and apply them to increase their cap in later years.
Who is eligible?
· You have a total super balance of less than $500,000 as at 30 June of previous
financial year
· Have unused concessional cap amounts in any of 5 previous financial years
NOTE: You will be required to have concessional contributions in excess of current
concessional cap
4. End of an Era – Superannuation Preservation age hits 60 on 1 July 2024
Preservation Age
Date of Birth | Age of Member on 30 June 2023 | Preservation Age | Financial year preservation age reached |
Before 1 July 1960 | 63+ | 55 | 2014-15 or earlier |
From 1 July 1960 to 30 June 1961 | 62 | 56 | 2016-2017 |
From 1 July 1961 – 30 June 1962 | 61 | 57 | 2018-19 |
From 1 July 1962 – 30 June 1963 | 60 | 58 | 2020-21 |
From 1 July 1963 to 30 June 1964 | 59 | 59 | 2022-23 |
On or after 1 July 1964 | 58 or less | 60 | 2024-25 or later |