Alex Kelly
Senior Manager
Contact West Carr & Harvey

Federal Budget announcement 2025 – updates for individuals

The key considerations for individuals as a result of the 2025 Federal Budget announcement are as follows:

Income tax cuts

The Stage 3 tax cuts previously announced will remain unchanged from 1 July 2024.

The new thresholds and tax rates are summarised below.

New threshold New tax
< $18,201
$18,201 to $45,000 16% of excess over $18,200
$45,001 – $135,000 $4,288 plus

30% of excess over $45,000

$135,001 to $190,000 $31,288 plus 37% of excess over $135,000
>$190,000 $51,638 plus 45% of excess over $190,000


Increasing the Medicare levy low-income thresholds

Low income individuals are exempt from paying the Medicare levy or pay a reduced rate.

The new thresholds are summarised below.

Income threshold 2022-23 2023-34
Singles 24,276 26,000
Families 40,939 43,846
Single seniors and pensioners 38,365 41,089
Family threshold for seniors and pensioners 53,406 57,198
Increase  in the threshold for each dependant student or child 3,760 4,027


Capping HELP debt indexation

The HELP debt indexation formula is currently based on the consumer price index (CPI).

The new formula will be based on the lower of CPI or the wage price index (WPI).

The measure is proposed to be backdated and applied from 1 June 2023. This means that the previous rate applied on loan balances at 1 June 2023 of 7.1% will be reduced to 3.2% (i.e. the lower of CPI and WPI).

Superannuation on parental leave

From 1 July 2025, eligible parents will receive an additional parental leave payment to their superannuation fund. The payment will be equal to the minimum superannuation guarantee amount, which is expected to be 12% when the changes are implemented.

Energy bill relief

The Government announced it will provide a $300 rebate to all Australian households on 2024-25 bills. The credits will be applied automatically in quarterly instalments.