Navigating financial advice in the social media age
Social media has transformed how we access information, including financial guidance. With the Australian Securities and Investments Commission (ASIC) recently taking regulatory action to warn “finfluencers” against acting illegally, it’s worth understanding how to evaluate the financial content you encounter online, so you can protect yourself against acting on unlicensed advice that could risk your money.
Research shows 63% of Gen Z Australians use social media for financial information, with over half expressing trust in content from financial influencers. In April, ASIC issued warning notices to four social media influencers suspected of providing unlicensed financial advice, including making claims about guaranteed returns.
Understanding the difference between general information and personal advice helps you evaluate online content appropriately. Licensed financial advisers can provide recommendations tailored to your specific circumstances, goals and risk tolerance. They’re required to act in your best interests and maintain professional standards.
PERSONAL TAXATION
Personal tax rates: existing cuts for 2026–2027 and 2027–2028 unchanged
In the Budget, the Government did not announce any further changes to the personal tax rates. However, the proposed new $250 working Australians tax offset (WATO) from 1 July 2027 is expected to increase the effective tax-free threshold for income derived from work by nearly $1,800 to $19,985 (or up to $24,985 for workers eligible for the low income tax offset (LITO).
The already-legislated tax cuts announced in the 2025–2026 Budget will apply from 1 July 2026 and 1 July 2027. The resident personal income tax rate for the taxable income bracket from $18,201 to $45,000 will reduce from 16% to 15% for the 2026–2027 income year, and then to 14% for the 2027–2028 and later income years. These changes reduce the tax payable for resident taxpayers by up to $268 from 1 July 2026, rising to up to $536 from 1 July 2027. No changes were made to the low income tax offset (LITO) in the 2026–2027 Budget.
The maximum amount of the LITO is $700. The LITO is withdrawn at a rate of 5 cents per dollar between taxable incomes of $37,500 and $45,000 and then at a rate of 1.5 cents per dollar between taxable incomes of $45,000 and $66,667.
Standard $1,000 deduction for work-related expenses from 2026–2027
The Budget confirmed that the proposed $1,000 standard deduction for work-related expenses will apply from the 2026–2027 income year, subject to enacting legislation. The measure, originally announced on 13 April 2025 as part of Labor’s 2025 election policy, will provide eligible taxpayers with a simpler way to claim a standard deduction of up to $1,000 without needing to incur or substantiate work-related expenses covered by the standard deduction.
The draft legislation for this measure proposes to introduce an optional $1,000 standard deduction for work-related expenses for individuals who are Australian tax residents at any time during the income year and derive “assessable labour income”. Broadly, assessable labour income includes amounts included in assessable income from which PAYG withholding is required, even if no amount is actually withheld, including salary and wages, directors’ fees, office-holder payments, certain termination or retirement payments and parental leave pay.
Capital allowances
Under the proposal, depreciating assets that a taxpayer reasonably expects to use mainly to produce assessable labour income cannot be allocated to a low-value pool from 1 July 2026. Where a balancing adjustment event occurs for a depreciating asset that has been used to produce assessable labour income, a taxpayer who has received the standard deduction for one or more income years overlapping with the asset’s effective life may choose to reduce the balancing adjustment amount by 50%. Related amendments will also address CGT event K7 calculations for depreciating assets used partly for non-taxable purposes.
Interaction with FBT
Where an expense payment fringe benefit is covered by the standard deduction and provided under a salary packaging arrangement, the otherwise deductible rule will not apply to reduce the taxable value. The employer will therefore be assessed on the full taxable value of the benefit, provided no other exemption or reduction otherwise applies.
The exemption for eligible work-related items will be limited to benefits provided outside salary packaging arrangements. The existing restriction on substantially identical items in the same FBT year will be repealed. The FBT amendments will apply to FBT years from 1 April 2027.
New $250 working Australians tax offset from 1 July 2027
A new working Australians tax offset (WATO) will be introduced to provide a permanent annual $250 tax offset from 1 July 2027 to all eligible Australian workers for their income derived from work (such as wages and salaries and the business income of sole traders).
Medicare levy low-income thresholds for 2025–2026
For the 2025–2026 income year, the Medicare levy low-income threshold for singles has been increased to $28,011 (up from $27,222 for 2024–2025). For couples with no children, the family income threshold is $47,238 (up from $45,907 for 2024–2025). The additional amount of threshold for each dependent child or student is $4,338 (up from $4,216).
For single seniors and pensioners eligible for the seniors and pensioners tax offset (SAPTO), the Medicare levy low-income threshold is $44,268 (up from $43,020). The family threshold for seniors and pensioners is $61,623 (up from $59,886), plus $4,338 for each dependent child or student.
Private health insurance rebate cut for those aged 65 and over
The Budget confirmed the Government’s previous announcement that the private health insurance rebate will be reduced for those aged 65 and over, to match the level paid for those under age 65. The Government has indicated its intention to redirect the savings from this measure into aged care.
In practical terms, the changes will remove the higher age-based private health insurance rebate tiers that currently apply where the oldest person covered by the policy is aged 65–69 or 70 and over.
Under the current rebate percentages applying from 1 April 2026 to 31 March 2027, and the income thresholds applying from 1 July 2026, the base-tier rebate (for singles with income of $105,000 or less and families with income of $210,000 or less) is 24.118% for those aged under 65, 28.139% for those aged 65–69, and 32.158% for those aged 70 and over. The announced measure will flatten the higher older-age rebates back to the under-65 rate, with effect from 1 April 2027.
BUSINESS TAXATION
Instant asset write-off for small businesses permanently extended.
The Government will permanently extend the $20,000 instant asset write-off for small businesses with a turnover of up to $10 million. The current $20,000 threshold was set to expire on 30 June 2026, with the threshold then reverting to a $1,000 threshold. However, with this permanent extension, small businesses will have more certainty over asset purchases going forward.
Assets valued $20,000 or more can continue to be placed into the small business simplified depreciation pool. Pool deductions are broadly 15% in the first year an asset is added to the pool and 30% for later years. The provisions that prevent small businesses from re-entering the simplified depreciation regime for five years after opting out will also continue to be suspended until 30 June 2027.
Business tax relief package for immediate support
The Federal Budget announcements include a comprehensive business tax relief package designed to support companies and encourage investment and innovation.
Small businesses can breathe easier with the permanent extension of the $20,000 instant asset write-off for businesses with turnover up to $10 million. This measure was set to revert to $1,000 on 30 June 2026 but now provides ongoing certainty for equipment purchases and business expansion plans.
Assets valued at $20,000 or more can continue to be placed into the small business simplified depreciation pool, with deductions of 15% in the first year and 30% thereafter. The provisions preventing businesses from re-entering the simplified depreciation regime for five years after opting out remain suspended until 30 June 2027.
Reintroduction of the loss carry-back regime
The Government will reintroduce the loss carry-back regime for most businesses and start-ups “to encourage investment and improve resilience through temporary shocks”. From 1 July 2026, companies with aggregated annual global turnover of less than $1 billion will be able to carry back a tax loss and offset it against tax paid up to two years earlier. Loss carry-back will apply to revenue losses only and will be limited by a company’s franking account balance.
This measure is expected to directly benefit up to 85,000 companies each year.
Loss refundability for small start-up companies
The Government will introduce loss refundability for small start-up companies. For tax years commencing on or after 1 July 2028, start-up companies with aggregated annual turnover of less than $10 million that generate a tax loss in their first two years of operation will be able to utilise the loss to generate a refundable tax offset. The offset will be limited to the value of fringe benefits tax and withholding tax on wages paid in respect of Australian employees in the loss year.
This measure is expected to support up to 25,000 new businesses each year.
Expansion of dynamic monthly business tax payments from 1 July 2027
As part of its package of measures to reduce red tape, the Government will work with the ATO to expand its pilot of dynamic pay as you go (PAYG) instalment calculations and expand access to monthly business tax payments.
From 1 July 2027, small and medium businesses will be able to opt into reporting and paying PAYG instalments monthly and to using an ATO-approved calculation embedded in accounting software to calculate and vary their instalments. The Government said this will support businesses by enabling tax instalments to better reflect real time business activity each month. Taxpayers with a demonstrated history of non-compliance will be required to report and pay PAYG instalments monthly.
Changes to FBT exemption for electric vehicles
The Government has confirmed its proposed changes to the FBT exemption for electric vehicles (EVs).
The changes will be phased in over the next three years until a permanent 25% discount is operating from 1 April 2029 for all eligible EVs. There will be no changes in the current FBT year (ending 31 March 2027). For EVs costing less than $75,000, there will be no changes until 1 April 2029.
MAJOR CGT, TRUSTS AND NEGATIVE GEARING REFORMS
CGT discount replaced; minimum 30% tax on net capital gains.
As widely anticipated, the Government will replace the current 50% CGT discount with inflation-adjusted indexation from 1 July 2027. The changes will include a minimum tax rate of 30% on realised gains, and the CGT net will be broadened to include pre-1985 assets (for disposals from 1 July 2027).
These changes will apply to all CGT assets held by individuals, trusts and partnerships for more than 12 months.
The changes take effect from 1 July 2027 and will be prospective; gains accrued on existing investments prior to the start date will retain the 50% discount up to the start date. Transitional arrangements will ensure the changes only apply to gains arising on or after 1 July 2027. This means the 50% CGT discount will continue to apply to gains arising before 1 July 2027.
Capital gains on pre-1985 assets arising before 1 July 2027 will remain exempt from CGT.
Proposed minimum tax rate on realised gains
There is little detail on the proposed minimum tax rate of 30% (to be imposed after indexation has been applied). The Budget Papers state that “a minimum tax rate on capital gains will reduce the incentive to hold onto an asset to realise a gain when it’s most tax advantageous and ensure a fair amount of tax is paid on capital gains, in line with lifetime incomes”. Income support recipients, including pensioners, will be exempt from the minimum rate.
It will be interesting to see how the minimum tax rate interacts with carry forward capital loss rules, as well as to those taxpayers with a loss on other income-related activities in the same income year.
Young adult workers win equal pay rights
The Fair Work Commission has delivered a landmark decision that will significantly impact junior wage rates across three major industries, with changes set to begin in December 2026.
On 31 March 2026, a Full Bench of the Fair Work Commission handed down its decision in response to an application by the Shop, Distributive and Allied Employees’ Association. The decision affects junior employees under the General Retail Industry Award 2020, Fast Food Industry Award 2020 and Pharmacy Industry Award 2020.
If your business employs junior staff in retail, fast food or pharmacy industries, this decision will likely affect your wage costs and workforce planning. The complexity of the new age- and experience-based criteria means careful attention to payroll systems and employee records will be essential. Given the significant financial implications and implementation complexities, consider seeking our advice to understand how these changes will specifically impact your business and ensure your compliance with the new requirements.
Payday super changeover requires careful cash flow planning
The transition to payday super is just months away, and employers need to prepare for a complex changeover period that could significantly impact cash flow during July 2026.
From 1 July 2026, employers must pay superannuation guarantee each payday instead of quarterly. Super payments must reach employees’ funds within seven business days after payday, marking the end of the current quarterly system that’s operated for decades.
The timing is important. Super payments for July paydays may be due before the final quarterly payment deadline of 28 July.
The ATO recommends reviewing expected pay cycles for July to understand cash flow impacts. Consider setting aside additional funds to meet dual obligations during the changeover.