1 July 2026 is a trigger for a series of high impact changes. Here’s what’s of importance to business, to you and your super.
Payday super starts today and employee super contributions must be paid on each pay run.
The day that employees are paid - called a ‘qualified earning’ made up ordinary times earnings, salary sacrifice contributions, and other salary and wage amounts - is the day that the employer is liable for the SG payment. The SG payment must be received by the employee’s super fund within 7 working days of the qualified earning being made, or a superannuation guarantee charge is likely to apply.
Payday super impacts every employee including those closely held to the business – family members, directors and shareholders of the company, beneficiaries of a trust.
Be careful with the change over between the old and new rules. Under the old rules, employers have until 28 July 2026 to pay their employee’s June quarter SG. This payment must be made by the due date or face the full SG charge liability. And, the new rules apply from 1 July 2026 regardless of the old system payment dates. So in July you might be paying the last SG quarterly payment under the old rules, and the SG payments under the new Payday super rules.
The ATO will use payroll and reporting data to monitor compliance more closely.
The $20,000 instant asset write-off enables small business to write-off a purchase in the same year that they purchased and installed it ready for use (instead of depreciating an asset over several years). The threshold amount was legislated at $1,000 but almost every year, the threshold has been increased, changed or altered by successive governments in the Federal Budget. It’s now permanent at $20,000.
The write-off is available to businesses with an aggregated turnover below $10m and can be used for multiple assets for use in the business. Second hand assets are also eligible for the write-off.
Eligible companies that make a loss this financial year or in future years, will now be able to carry back a tax loss and offset it against tax paid in the two prior years.
The ability to carry back a loss is available to companies with an aggregated annual global turnover of less than $1 billion. Loss carry back applies to revenue losses only and will be limited by a company’s franking account balance.
A 1% income tax cut comes into effect from 1 July 2026. The tax cut reduces the $18,201 to $45,000 tax bracket from a 16% tax rate to 15% - worth up to $286 per year.
The single and pensioner tax offset (SAPTO) thresholds also change as a result of the tax cuts but there is no change to the maximum tax offset amounts (see the ATO for details).
The Medicare Levy Surcharge threshold – the surcharge that applies when you do not hold private health insurance - has also increased to $105,000 for individuals and $210,000 for families.
Taxpayers will be able to opt to take a standard $1,000 work related tax deduction instead of claiming individual expenses on their 2026-27 tax return. See Swapping receipts for a $1k instant tax deduction.
From 1 July 2026, the National Minimum Wage will increase by 4.75% to $26.44 per hour, or $1,005 per week.
The increase applies from the first full pay period starting on or after 1 July 2026. That is, if your weekly pay period starts on Thursday, the new rates apply from Thursday, 2 July 2026.
The Government’s paid parental leave scheme now covers up to 26 weeks of paid leave (up from 24 weeks).
If your total super balance for this financial year is above $3m, the Division 296 tax is likely to apply. Division 296 is an additional tax of 15% on fund earnings above $3m, with a second 10% tax on the proportion of fund earnings above $10m.
For Division 296 purposes, your total super balance includes super income stream amounts you inherited (i.e., death of a spouse), super interests from a divorce, and excludes any limited recourse borrowing arrangements.
30 June 2027 is the first measurement date with the first notices will be issued during the 2028 financial year.
The ATO will calculate the tax and if applicable, send you a Div 296 notice. You can pay any amount owing personally or elect to have your fund pay it.
There are some special rules for reversionary pensions, defined benefit interests, temporary residents departing Australia, child recipients of a super income stream and for those whose super was bolstered by personal injury compensation.
The amount you can contribute to superannuation under the concessional contributions cap - employer contributions and tax-deductible personal contributions - has increased to $32,500 (up from $30,000).
The non-concessional contributions cap has also increased to $130,000 (up from $120,000). This is the amount you can contribute to super from after-tax income. For those using the ‘bring-forward rule’, this means you can contribute up to $390,000 by using the cap for this year and 2 future years in one contribution. To use the bring-forward rule you must be under 75 in the financial year, your total super balance allows it, and you fund can accept the contribution.
Your transfer balance cap is the amount of money you can transfer into a tax-free retirement income stream. The general transfer balance cap has increased to $2.1m from $2m.
From 1 July 2026, accountants must perform identification and verification of clients and ultimate beneficial owners, in relation to certain services being provided. This will require proof of identify checks for individuals, directors of companies and some shareholders.
We are required to have processes and procedures in place to monitor for high risk activity such as anonymous transactions, or unusual cross border transactions particularly where these transactions are tied to countries with weak regulations or conflict zones.
Hayes Knight can assist you if you are concerned about any of the changes. It’s important not to react to the changes without knowing the true impact on your individual scenario - contact us.
Who to contact:
Dara Siyali
Associate Director, Business Services
Chris Hodgins
Director, Superannuation
Michael Zdrilic
Director, Financial Services