GEARING UP FOR 1 JULY | What you Need to Know!

With the dawn of the new financial year comes a host of changes that small biz owners and employers need to be on top of. Ignorance is NOT bliss on this one! Starting from 1 July, brace yourselves for:

⚡Payday Super Begins⚡

It has been a long time coming and the day has finally arrived as payday super begins 1 July 2026. In its most basic form it means that employers must pay superannuation at the same time as wages, instead of quarterly. It is aimed to reduce unpaid super and improve retirement balances (and to be honest it just makes sense).

Warning: We cannot highlight enough how important it is to pay super on time as the penalties if you don't are large, ie, the superannuation payment becomes non-deductible, you need to lodge a superannuation guarantee statement and pay penalties and interest and not to mention the super audits. So follow the straight and narrow on this one 😉

Action:  Your payroll providers should be all over this so follow their guidance to ensure you are setup and ready to roll now!

Recommend: If you want more details check out our blog.

⚡Minimum Award Rate Increases⚡

Another increase has landed. A 4.75% increase to be exact for minimum and award wages which applies from the first full pay period on or after 1 July 2026. The following figures highlight the current state and projected changes:

• Current Minimum Wage (Until 30 June 2026): $24.95 per hour or $948.00 per 38-hour week (before tax).

• New Minimum Wage (from 1 July 2026): Increases to $26.44 per hour or $1,004.90 per 38-hour week. That's a 6% lift to the National Minimum Wage, the first time it has cracked $1,000 a week. Worth noting that award rates rose by 4.75%, so most workers will see that figure rather than the headline 6%.

• Casual Loading: Hourly rate jumps to $33.05, because flexibility deserves a little extra, right?!

Warning: Payroll is high risk, and you need to get it right. Don't be a George Calombaris and plead ignorance—it won’t fly.

Action:  Update your payroll systems to include the increase from the first full pay period starting on or after 1 July 2026 to stay compliant.

Recommend: Refer to your industry award or connect with your industry body for support. And of course, we’re always here to help. If you have complex payrolls, consider using a third-party app like  Deputy, Employment Hero or Tanda for support—especially if they offer award interpretation. Feeling overwhelmed? Engage with us—we’re the payroll experts ready to support your biz. 😉 

⚡Tax Rates⚡

Personal Income Tax Cuts are on the menu this year. The lowest marginal tax rate drops from 16% to 15% for income between $18,201 and $45,000. YAY for everyone!

The 2026 tax rates are ...

• $0 – $18,200: 0% (tax-free threshold)

• $18,201 – $45,000: 15% (down from 16%)

• $45,001 – $120,000: 30%

• $120,001 – $180,000: 37%

• $180,001 and over: 45%

Action:  Make sure your payroll software is up to date to stay compliant. If you are with Xero you don't need to worry, they will have this covered for you.

Senior and pensioner tax offset (SAPTO) thresholds will also change from 1 July 2026 as a result of the tax cuts. There will be no changes to the maximum tax offset amounts. Below are the SAPTO threshholds:

Status	Maximum tax offset amount	Shading-out threshold	Cut-out threshold
Single	$2,230	$36,034	$53,874
Each partner of a couple	$1,602	$31,847	$44,663
Each partner of an illness separated couple	$2,040	$34,767	$51,087

PS. If you are wondering about the $1,000 instant tax deduction you shall have to wait a little longer, it's not due to kick in until you lodge your 2026/27 tax return, and it still needs to be legislated.

⚡Bonuses for Employees⚡

This one isn’t a change—more a highlight in bright neon lights, as we see many employers incorrectly treat bonuses.

The taxman-ian devil (aka the ATO) treats bonuses like salary and wages (the ATO says, "gimme allllll of that TAX"). So, bonuses MUST be processed through your payroll system, with the net cash (gross less tax) paid to the employee. Want to know how to process a bonus in Xero? They’ve got a great article on it—check it out here.

Recommend: Read our blog here for more info.

⚡Instant Asset Write Off⚡

The instant asset write-off threshold is locked and loaded at $20,000. That is a handy win for small business owners who want the tax deduction for assets straight up rather than later.

But that does mean that plant & equipment >$20,000 needs to be reported on the balance sheet and depreciated over it's effective life as we are well past Covid times where there were no caps. Ahhh the good ole days, NOT!

⚡FBT exemption for EV's⚡

The proposed changes to the Fringe Benefits Tax (FBT) exemption for Electric Vehicles (EVs) will take effect from 1 April 2027. Here are the key points of the changes:

• Full FBT exemption: The full FBT exemption for eligible EVs will continue until 31 March 2027.

• 25% discount: From 1 April 2027 to 1 April 2029, the full FBT exemption will apply only to EVs valued at $75,000 or less. EVs valued above $75,000 but below the luxury car tax (LCT) threshold will receive a 25% discount on their payable FBT.

• 25% discount from 2029: From 1 April 2029 onwards, all eligible EVs valued below the LCT threshold will receive a 25% FBT discount.

• Existing leases: Existing leases will not be impacted by these changes.

⚡What's Coming?!⚡

Unless you have been living under a rock you would be aware that there are significant changes on the horizon from 1 July 2027 related to capital gains tax, negative gearing, trust distributions and tax rates and lending recourse borrowing arrangement in super. Rest assured these deets will come but for now let's just focus on what we need to get right this financial year. 😊

Well, that's it for now, folks. Happy New Financial Year—may it be a goodie!

As always, if you have any questions about the above, feel free to reach out to one of our oh-so-cool, not-nerdy-at-all team members today.

Disclaimer: The information provided is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice.