Personal income tax cuts confirmed

From1 July 2024

As previously announced, the Government has legislated permanent tax cuts for all Australian taxpayers from 1 July 2024.

Relative to the previous Stage 3 plan, the redesigned cuts broaden the tax cut’s benefits by focusing on individuals with taxable income below $150,000.

For rates, see Personal income tax rates from 1 July 2024.

Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024

Medicare levy low-income thresholds increase

From1 July 2023

The Medicare levy low-income thresholds will be increased for singles, families, seniors and pensioners from 1 July 2023.

Medicare low-income thresholdThreshold as at 30 June 2023Threshold from 1 July 2023
Single – seniors and pensioners$38,365$41,089
Family – seniors and pensioners$53,406$57,198
Family – for each dependent child or student[1]$3,760$4,027

The increases to the thresholds take account of recent movements in the CPI so that low-income taxpayers generally continue to be exempt from paying the Medicare levy.

$300 energy relief for households

From1 July 2024

Households will receive a credit of $300 on their energy bills credited as automatic quarterly instalments across 2024-25.

Energy relief will also be provided to eligible small businesses through a $325 rebate.

Costing $3.5bn over three years from 2023-24, the measure extends and expands the Energy Bill Relief Fund.

Media release: New power bill relief

Capping indexation of HELP debts

FromLoan accounts that existed on 1 June 2023

As previously announced, the Government will cap the HELP indexation rate to be the lower of either the CPI or the Wage Price Index (WPI), effective from 1 June 2023. The change will apply to all HELP, VET Student Loans, Australian Apprenticeship Support Loans and other student support loan accounts that existed on 1 June 2023.

By changing the calculation of HELP indexation from 1 June 2023, the indexation rate is reduced from:

  • 7.1% to 3.2% in 2023, and
  • 4.7% to around 4% in 2024.

The change resolves an issue for more than 3 million Australians with a HELP debt when the CPI indexation rate spiked to 7.1% last year.

An individual with an average HELP debt of $26,500 will see around $1,200 wiped from their outstanding HELP loans this year, pending the passage of legislation.

Estimated indexation for HELP debts

HELP debt at 30 June 2023Total estimated credit for 2023 and 2024*

*Actual credit amount will vary depending on individual circumstances, including repayments made during the year. All HELP debts that were indexed in 2023 and are subject to indexation on 1 June 2024 will receive an indexation credit.

Media Release: Cutting student debt for more than three million Australians

Superannuation on paid parental leave

From1 July 2025

As previously announced, from 1 July 2025, superannuation will be paid on Paid Parental Leave payments from 1 July 2025.

Eligible parents will receive an additional payment based on the superannuation guarantee (i.e. 12% of their PPL payments) as a contribution to their superannuation fund.

This payment is in addition to the changes that saw families provided with an extra two weeks of leave (22 weeks total), which will increase to 24 weeks from July 2025 and 26 weeks from July 2026 (see Paid Parental Leave Amendment (More Support for Working Families) Bill 2023, Royal Assent 20 March 2024).

Media Release: Paying super on Government Paid Parental Leave to enhance economic security and gender equality


Increasing Commonwealth rent assistance

From20 September 2024

The Commonwealth rent assistance maximum rates will increase by 10% from 20 September 2024.

Recipients of Centrelink/Department of Veterans Affairs payments and those receiving family tax benefit may also receive rent assistance if they pay rent or other rent-like payments over a minimum fortnightly threshold.

The current maximum fortnightly rates are $188.20 for a single person and $177.20 combined for a couple.

The measure will cost $1.9 billion over five years from 2023–24 (and $0.5 billion per year ongoing from 2028–29) and builds on the 15% increase in September 2023, taking the maximum rates over 40% higher than in May 2022.

Improving aged care support

The Government will provide funding of $2.2 billion over the next five years to deliver key aged care reforms and to continue to implement recommendations from the Royal Commission into Aged Care Quality and Safety.

This funding includes the release of an additional 24,100 home care packages in 2024-25.

The Government has also agreed to defer the commencement date of the new Aged Care Act to 1 July 2025.

The Government is currently considering and implementing changes to how aged care is funded on the back of the Royal Commission into Aged Care Quality and Safety report released in 2021.

This will likely impact home care and residential care fees in the future. Generally, with past reforms, we have seen existing residents and home care recipients ‘grandfathered’ under the rules at the time they entered.

Increased flexibility for carer payment

Date20 March 2025

To receive the Centrelink Carer Payment, the caregiver is required not to be involved in work, study or training for more than 25 hours per week. This is to reflect the requirement that to receive this payment, the caregiver should be providing the care recipient with ‘constant care’.

From 20 March 2025, the existing 25 hours per week will be amended to 100 hours over four weeks.

This limit will no longer capture study, volunteering, and travel time, so it will only apply to employment.

In addition:

  • Carer Payment recipients exceeding the participation limit or their allowable temporary cessation of care days will have their payments suspended for up to six months rather than cancelled.
  • Recipients will also be able to use single temporary cessation of care days where they exceed the participation limit rather than the current seven-day minimum.

Higher JobSeeker rate for partial capacity to work

Date20 September 2024

The Government will extend eligibility for the existing higher rate of JobSeeker payment to single recipients with a partial capacity to work (zero to 14 hours per week) from 20 September 2024.

Currently, those on JobSeeker payments aged 55 or over and who have been on the payment for nine continuous months receive a higher payment rate. These are:

Relationship statusMaximum payment per fortnight
Single with no children$762.70
Single with dependent children$816.90
Single 55 or older after nine continuous months of payments$816.90
Partnered (Each)$698.30

Freezing social security deeming rates

Date12 months until 30 June 2025

When calculating Centrelink and Department of Veterans Affairs payments, rather than assessing the actual income from financial investments, a deemed rate of return based on the total value of these investments is assumed. Some common examples of financial investments include bank accounts, term deposits, shares and managed funds.

The Government proposes to freeze the deeming rates (shown below) until 1 July 2025:

Deeming rateSinglePensioner Couple
0.25%Up to $60,400Up to $100,200
2.25%Amounts over $60,400Amounts over $100,200

Pharmaceutical Benefits Scheme co-payments

From1 January 2024

The Government will ensure that the cost of medicines remains low by freezing indexation:

  • PBS general co-payments to not be indexed between 1 January 2025 and 31 December 2025 (inclusive), with indexation resuming on 1 January 2026
  • PBS concessional co-payments to not be indexed between 1 January 2025 and 31 December 2029 (inclusive), with indexation resuming on 1 January 2030

The $1 optional discount available on patient co-payments for subsidised prescriptions will be reduced each year by the relevant notional indexation amount until the $1 discount has been reduced from $1 to zero.

From 1 January 2024, you may pay up to $31.60 for most PBS medicines or $7.70 if you have a concession card. The Australian Government pays the remaining cost (except for brand premiums and other allowable charges).

Federal, state and territory governments focus on housing

Housing initiatives address three key areas:

  • Private commercial development of future housing supply – the Government has outlined an ambitious goal of building 1.2 million homes by the decade’s end. The 2023-24 Budget announced new measures to encourage investment and development of housing, particularly build-to-rent developments that included affordable housing. However, the draft legislation enabling the announced incentives has only recently been released by Treasury. It is difficult to encourage large-scale investment if you do not follow through with legislation that provides certainty. No new measures have been announced to date.
  • Support to help ease the path to homeownership for first-home buyers – also a policy dominant in the 2023-24 Budget with $5.5bn over a decade committed to the Help to Buy scheme. No new incentives have been announced to date.
  • Crisis and social housing support – the Government has announced $1bn directed towards crisis and transitional accommodation for women and children fleeing domestic violence and youth. This measure is on top of the 15% increase to Commonwealth Rent Assistance in the 2023-24 Budget.

As previously announced, much of the Budget funding flows to the States and Territories to increase housing stock, increase social housing, and provide crisis accommodation. New measures include:

  • $1bn for states and territories to build the roads, sewers, energy, water and community infrastructure; and
  • A new $9.3 billion 5‑year National Agreement on Social Housing and Homelessness – for states and territories to combat homelessness, provide crisis support and build and repair social housing. This includes doubling the Commonwealth’s homelessness funding to $400 million yearly, matched by states and territories.
Media Release: Multi-billion-dollar investment to build more homes for Australians
Treasury consultation: Build-to-rent tax concessions

Domestic violence

DateFrom mid-2025

As previously announced, the Government has committed almost $1bn over five years to establish the Leaving Violence Program permanently – so those escaping violence can receive financial support, safety assessments and referrals to support pathways. Those eligible can access up to $5,000 in financial support along with referral services, risk assessments and safety planning.

Media Release: Helping women leave a violent partner payment

[1] For each dependent child or student, the family income threshold increases by the stated amount.