As we approach the new financial year, it’s important to be aware of several changes coming into effect from 1 July 2024. These updates impact various aspects of payroll, superannuation, tax, and employment benefits. Below, we outline the key changes to help you prepare and ensure compliance.
Termination Payments
Superannuation
Superannuation contributions and caps are changing:
Superannuation Guarantee Rate: Increases to 11.5%.
Maximum Contributions Base (per quarter): Rises to $65,070.
Concessional Contributions Cap (annual): Increased to $30,000.
Non-Concessional Cap (annual): Increased to $120,000.
All income paid on or after 1 July 2024, including back pays, will be subject to the new superannuation guarantee rate of 11.5%.
| Payment | 1 July 2023 | 1 July 2024 |
|---|---|---|
| Superannuation Guarantee | 11% | 11.5% |
| Maximum Contributions Base (per quarter) | $62,270 | $65,070 |
| Concessional Contributions Cap (annual) | $27,500 | $30,000 |
| Non- Concessional Cap (annual) | $110,000 | $120,000 |
Employer Contributions
Employer super contributions under the cap are taxed at 15%. Contributions exceeding the cap are taxed at marginal rates. Employees with taxable income (including super) over $250,000 will face a higher tax rate of 30%.
Concessional Contribution Cap
Since 1 July 2018, employees can use their unused concessional caps on a rolling basis for five years. Managing these caps is not a payroll function and employees should consult their super fund or financial adviser.
Cents per Kilometre
From 1 July 2024, the ATO cents per kilometre rate will increase to $0.88. The Clerks Award comparison rate is yet to be announced.
| Payment | 1 July 2023 | 1 July 2024 |
|---|---|---|
| ATO cents per km | $0.85 | $0.88 |
| Clerks Award comparison | $0.95 | TBA |
Fair Work Updates
Significant changes include:
National Minimum Wage: Increases to $915.90.
Wage Increase in Awards: Set at 3.75%.
These changes apply from the first full pay period starting on or after 1 July 2024.
| Payment | 1 July 2023 | 1 July 2024 |
|---|---|---|
| National Minimum Wage | $882.80 | $915.90 |
| Wage Increase in Awards | 5.75% | 3.75% |
| Government Paid Parental Leave | $882.75 | TBA |
| Unfair Dismissal High Income Threshold | $167,500 | TBA |
Personal income tax rates and thresholds
The government has announced changes to individual income tax rates and thresholds effective 1 July 2024:
Current Tax Rate
| Taxable income | Tax on this income |
|---|---|
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 19% |
| $45,001 – $120,000 | 32.5% |
| $120,001 – $180,000 | 37% |
| $180,001 and over | 45% |
NEW Tax Rates from 1 July 2024
| Taxable income | Tax on this income |
|---|---|
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 16% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| $190,001 and over | 45% |
Working Holiday Maker (WHM) Tax Rates
Current WHM Tax Rate
| Taxable income | Tax on this income |
|---|---|
| $0 – $45,000 | 15% |
| $45,001 – $120,000 | 32.5% |
| $120,001 – $180,000 | 37% |
| $180,001 and over | 45% |
WHM Tax Rate from 1 July 2024
| Taxable income | Tax on this income |
|---|---|
| $0 – $45,000 | 15% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| $190,001 and over | 45% |
Fringe benefits
| Item | FBT from 1 April 2023 | FBT from 1 March 2024 |
|---|---|---|
| FBT rate | 47% | 47% |
| Type 1 Gross-up Rate (with GST) | 2.0802 | 2.0802 |
| Type 2 Gross-up Rate (without GST) | 1.8868 | 1.8868 |
| RFBA threshold | Exceeds $2,000 | Exceeds $2,000 |
| RFBA minimum grossed-up value | $3,773 | $3,773 |
| Minor benefits threshold | Under $300 | Under $300 |
| Car parking threshold | $10.40 per day | TBA |
| Benchmark interest rate | 7.77% | 8.77% |
Living Away From Home
Allowance (food)
| Family Groupings | Reasonable Food Component (weekly) | Statutory Food Component (weekly) | Exempt Food Component (weekly) |
|---|---|---|---|
| One Adult | $331 | $42 | $289 |
| Two Adults | $497 | $84 | $413 |
| Three Adults | $663 | $126 | $537 |
| One Adult and One Child | $414 | $63 | $351 |
| Two Adults and One Child | $580 | $105 | $475 |
| Two Adults and Two Children | $663 | $126 | $537 |
| Two Adults and Three Children | $746 | $147 | $599 |
| Three Adults and One Child | $746 | $147 | $599 |
| Three Adults and Two Children | $829 | $168 | $661 |
| Four Adults | $829 | $168 | $661 |
Important LAFHA rules
LAFHA is paid in two components:
- Exempt Food Component – when using the ATO formula.
- Exempt Accommodation Component – for reasonable accommodation costs.
Eligibility Considerations
- You must be required to live away from home for work-related purposes.
- The period you will be away from home is greater than 21 days, but no greater than 12 months.
You must intend to return home and be maintaining a house in Australia that is available to move back into.
- LAFHA declaration must be completed.
- Documentation must show that the statutory component has been deducted.
Instant asset write off extension
As part of the 2024–25 Budget, the government announced it will continue to improve cash flow and reduce compliance costs for small businesses by extending the $20,000 instant asset write-off by a further 12 months until 30 June 2025.
Luxury car tax
The following table lists the LCT thresholds for the financial year the car was imported, acquired or sold.
If you import or sell a car with a GST-inclusive value above these LCT thresholds, you must pay LCT except in certain circumstances. In general, the LCT value of a car includes the value of any parts, accessories or attachments you supplied, or imported, at the same time as the car.
| Financial year | Fuel efficient vehicles | Other vehicles |
|---|---|---|
| 2024-25 | $91,387 | $80,567 |
| 2023-24 | $89,332 | $76,950 |
| 2022-23 | $84,916 | $71,849 |
| 2021-22 | $79,659 | $69,152 |
| 2020-21 | $77,565 | $68,740 |
| 2019-20 | $75,526 | $67,525 |
| 2018-19 | $75,526 | $66,331 |
| 2017-18 | $75,526 | $65,094 |
| 2016-17 | $75,526 | $64,132 |
| 2015-16 | $75,375 | $63,184 |
| 2014-15 | $75,375 | $61,884 |
| 2013-14 | $75,375 | $60,316 |
| 2012-13 | $75,375 | $59,133 |
Car GST Thresholds
If you buy a car and the price is more than the car limit ($69,674), the maximum GST credit you can claim (except in certain circumstances) is one-eleventh of the car limit. For the 2024–25 income year, the maximum GST credit you can claim is $6,334 (that is, 1/11 × $69,674).
You can’t claim a GST credit for any luxury car tax you pay when you buy a luxury car, even if you use it for business purposes.
Staying informed about these updates is crucial for compliance and effective payroll management. If you have any questions or need assistance, please feel free to contact us. At Gecko Cloud Solutions, we are committed to helping you navigate these changes smoothly.
