2025–26 Federal Budget Briefing: What It Means for Superannuation, Tax and Retirement Planning
The 2025–26 Federal Budget introduces several legislative updates that will impact superannuation strategies, tax planning, and social security entitlements across Australia. Below is a practical summary of the key updates and how they might influence your financial decisions.
Superannuation Changes
Increased Superannuation Guarantee (SG) From 1 July 2025, the SG rate increases from 11.5% to 12%, continuing the legislated trajectory to boost retirement savings for employees.
Employers must update payroll systems accordingly. Employees benefit from higher contributions over time.
Concessional and Non-Concessional Contribution Caps Due to indexation:
Concessional cap increases to $30,000 (up from $27,500)
Non-concessional cap increases to $120,000 (up from $110,000)
Bring-forward rule threshold rises to $1.9 million, meaning individuals under age 75 can contribute up to $360,000 over three years if their total super balance is under that threshold.
Transfer Balance Cap (TBC) The TBC increases to $2 million (from $1.9 million), which is the maximum amount that can be moved into a tax-free retirement pension phase.
Helps retirees hold more funds in the 0% tax environment.
Personal Tax and Offsets
Stage 3 Tax Cuts – Revised As legislated, from 1 July 2024:
The 32.5% marginal tax rate reduces to 30% for income between $45,001 and $135,000.
The top threshold for the 37% bracket drops from $180,000 to $190,000.
These changes aim to benefit middle-income earners, increasing disposable income.
Social Security and Aged Care Updates
Work Bonus Enhancement
Eligible pensioners can now earn up to $11,800/year (up from $7,800) without reducing their Age Pension.
Designed to encourage part-time work and delay retirement.
Deeming Rates Frozen
The deeming rate freeze is extended until 30 June 2026, offering relief to retirees amid rising living costs.
Lower deeming rates mean more favourable asset-tested income assessments for Age Pension recipients.
SMSF and Retirement Strategies
Downsizer Contributions: Still available for those aged 55 and over, allowing up to $300,000 per individual to be contributed to super from the sale of a primary residence.
Legacy Pension Reform: The Government is still consulting on reforms to outdated pension structures within SMSFs.
What Should You Do Next?
These updates present opportunities to increase super savings, minimize tax, and enhance retirement income streams—but timing and strategy are key.
How ActOn Wealth Can Help
At ActOn Wealth, we work closely with clients to ensure their financial strategies adapt to changing legislation. Our team can help you:
Maximise Super Contributions using the new caps and bring-forward rules
Optimise Tax Efficiency under the updated personal tax thresholds
Enhance Retirement Income through pension structuring and SG planning
Integrate Budget Changes into a long-term wealth strategy
Manage Transition-to-Retirement Strategies (TTR) under the updated transfer caps
Take control of your financial future. Contact ActOn Wealth today for a personalised plan that makes the most of the 2025–26 budget changes.
