Following is a summary of key information any payroll professional requires to ensure compliance in the 2025/26 financial year. From 1st July, 2025 the following changes apply:
- For redundancies, the Lump Sum D threshold will increase to $13,100 + $6,552 for each completed year of service
- The ETP indexed cap will increase to $260,000
- The Maximum Super Contribution Base (MSCB) will drop to $62,500 per quarter from 1 July 2025. Annually, this is equivalent to $250,000. Note: Employer superannuation guarantee obligations stand alone for each quarter and are not calculated on a monthly or annual basis.
- The Concessional Contributions Cap remains the same at $30,000 – this is the amount employees can contribute to their fund (SG, Salary Sacrifice, Co-Additional) before being taxed at the highest rate. *Note that there is also Division 293 Tax to take into consideration.
- Superannuation Guarantee increases to 12%
- Medicare Levy remains at 2%
- The cents per kilometre rate remains the same at 88 cents per kilometre. Up to 5,000 business kilometres can be claimed without paying tax. If paying in addition to 5,000 kilometres or more than 88 cents, tax should be withheld from the applicable portion
- From the first full pay period on or after 1st July 2025 there is a 3.5% increase to the minimum wage to $24.95 per hour or $948.10 per week. The 3.5% also applies to all modern awards.
- From 1st July SG Contributions will be made on Government funded Parental Leave, thankfully this will not be done by the employer, but will be paid annually in arrears by the ATO with an interest component.
If you are unsure if your payroll is compliant, call E-Payoffice and enquire about our payroll service. For most businesses, our payroll service is a cost-effective payroll solution compared to in-house processing.
