Personal Tax Rates: Stage 3 (As Revised) Confirmed from 2024–2025

In the 2024–2025 Federal Budget, the Government did not announce any further changes to the personal tax rates.

The Government’s revised Stage 3 tax changes (as announced on 25 January 2024 and enacted into law by the Treasury Laws Amendment (Cost of Living Tax Cuts) Act 2024) commence from 1 July 2024. The Treasurer said all 13.6 million taxpayers will receive a tax cut from 1 July 2024. The average annual tax cut is $1,888 (or $36 a week).

The tax rates and income thresholds from the 2024-25 for residents (as already legislated) are:

  • taxable income up to $18,200 – nil;
  • taxable income of $18,201 to $45,000 – nil plus 16% of excess over $18,200;
  • taxable income of $45,001 to $135,000 – $4,288 plus 30% of excess over $45,000;
  • taxable income of $135,001 to $190,000 – $31,288 plus 37% of excess over $135,000; and
  • taxable income of more than $190,001 – $51,638 plus 45% of excess over $190,000.

This means, when compared to 2023–2024, that for 2024–2025 the 19% tax rate has been reduced to 16%; the 32.5% tax rate has been reduced to 30%; the 37% tax rate threshold has been increased from $120,000 to $135,000; and the 45% tax rate threshold has been increased from $180,000 to $190,000.

 

Important: Clients should not act solely on the basis of the material contained here. Items herein are general comments only and do not constitute or convey advice per se. Also, changes in legislation may occur quickly. We, therefore, recommend that our formal advice be sought before acting in any of the areas.

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