The start of July also brings a new financial year, and with it a number of regulatory changes.
Here is a brief summary of the key changes that commenced on 1 July 2014:
Superannuation Guarantee Increased to 9.5%
As was previously legislated, from 1 July 2014 the Superannuation Guarantee rate increased from 9.25% to 9.5%.
This rate effects superannuation paid on ordinary times earnings – generally salaries and wages earned by employees.
It is proposed that the rate will stay fixed at 9.5% for the next four years, before rising by 0.5% per annum, reaching 12% on 1 July 2023.
Medicare Levy Increased to 2%
The Medicare Levy has increased from 1.5% to 2% from 1 July 2014.
Temporary Budget Repair Levy Introduced
In the recent Federal Budget, the Government announced a new "levy" on taxpayers earning more than $180,000 a year.
The levy is charged at 2%, and will only apply to income over the $180,000 threshold (not all taxable income). It is proposed to be a temporary charge only, and is proposed to apply from 1 July 2014 to 30 June 2017.
This increase, together with the increase in the Medicare Levy, takes the effective top marginal tax rate from 46.5% to 49%.
Changes to Super Contribution Limits
The amount that can be contributed to super has changed.
For the 2014/15 year, the superannuation limits are as follows:
(including Superannuation Guarantee,
salary sacrifice,extra employer and
tax-deductible personal contributions)
$30,000 for those aged under 49 years
on 30 June 2014
$35,000 for those aged 49 years or more
on 30 June 2014
(including spouse, after-tax and non-
deductible personal contributions)
If under age 65, you can contribute up
to $540,000 in a three-year period. This
period starts from the first year you
add more than $180,000 after tax
Government Co-Contribution Threshold
The threshold for eligibility for the Government Superannuation co-contribution has increased to $49,488 for the 2014/15 year.
Taxpayers earning less than this amount who make non-concessional superannuation contributions may be eligible for a Government co-contribution to super of up to $500, tax free.