February 26, 2025

What Do 2025 Australian Tax Changes Mean for You and Your Business?

Article Summary: The 2025 Australian tax changes bring significant updates for individuals and businesses, impacting company tax rates, personal income tax brackets, superannuation, and deductions. This article answers key questions, explores practical steps to leverage these changes, and offers guidance to ensure compliance and maximise financial opportunities. Whether you’re a business owner or an individual taxpayer, discover how to stay ahead with actionable insights and expert support from Cosca.

What Are the Australian Company Tax Rate Updates?

The company tax rate for base rate entities remains at 25% in 2025. However, businesses must meet eligibility criteria to access this rate.

Key Points:

Businesses must have an annual turnover of less than $50 million.

Passive income (e.g., dividends, interest) must be under 80% of total income.

According to the Australian Taxation Office (ATO), reviewing your business structure annually can help maintain compliance and maximise tax savings.

Are you looking to confirm your eligibility and optimise your tax strategy? Connect with our team today.

How Do I Claim the Instant Asset Write-Off in 2025?

The instant asset write-off scheme allows businesses to claim immediate deductions for eligible purchases, improving cash flow.

What’s New in 2025?

Businesses with turnover under $10 million can claim for assets costing up to $20,000.

Assets must be installed and ready for use by 30 June 2025.

The Australian Chamber of Commerce and Industry notes this scheme helps small businesses invest in productivity-enhancing equipment.

Steps to Claim:

Identify eligible assets purchased in the financial year.

Ensure assets meet the cost and installation criteria.

Include the claim in your tax return or consult an accountant for assistance.

What Is the Superannuation Guarantee Rate for 2025?

The superannuation guarantee (SG) rate increased to 11.5% in 2025 as part of its gradual rise to 12% by 2026.

Key Considerations:

Update payroll systems to reflect the higher SG rate.

Ensure super payments are made on time to avoid penalties.

The Association of Superannuation Funds of Australia (ASFA) reports these increases are designed to improve Australians’ retirement savings.

What Are the 2025 Personal Income Tax Brackets?

Updated income tax brackets provide relief for low- and middle-income earners.

Key Changes:

The 19% tax bracket now applies to incomes up to $50,000 (up from $45,000).

Adjustments to the 32.5% bracket offer further relief for middle-income Australians.

How can you review your salary packaging and deductions to reduce your taxable income? Speak to one of our team members today.

How Do I Claim Work-From-Home Expenses in 2025?

The ATO revised its work-from-home deductions, increasing the fixed rate but requiring stricter documentation.

What’s Changed?

Fixed rate: 67 cents per hour (up from 52 cents).

Covers: Electricity, internet, phone, and equipment depreciation.

Requirements: Detailed logs of hours worked and receipts for expenses.

Steps to Claim:

Track hours worked using a logbook or digital tool.

Collect receipts for eligible expenses.

Submit the claim in your tax return.

What Is the Small Business Tax Offset for 2025?

The Small Business Income Tax Offset remains at 16%, capped at $1,000 per individual. It provides relief for businesses with turnover under $5 million.

Tip: Combine this offset with other deductions or grants for maximum savings. Cosca’s business advisory team can help identify additional opportunities.

What Are the New ATO Compliance Requirements for 2025?

The ATO has introduced stricter compliance and reporting obligations for 2025, particularly for businesses using digital platforms.

Key Changes:

Expanded Single Touch Payroll (STP) requirements for employers.

Enhanced reporting for platforms like Square, PayPal, or crypto wallets.

Steps to Stay Compliant:

Reconcile accounts regularly.

Keep detailed records of all digital transactions.

Update reporting processes to meet ATO standards.

What Grants and Incentives Are Available in 2025?

Several government grants and incentives remain available to support Australian businesses.

Popular Incentives Include:

R&D Tax Incentive: For innovation-focused businesses.

Export Market Development Grant (EMDG): Supporting international expansion.

Technology Investment Boost: Offering deductions for digital upgrades.

Steps to Apply:

Check eligibility via business.gov.au.

Gather required documentation early.

Submit your application before deadlines.

Need help or advice on Grants and Incentives? Cosca’s business advisory team can guide you in securing grants that align with your goals.

1. What is the company tax rate for small businesses in 2025?

It’s 25% for businesses with turnover under $50 million and passive income below 80%.

2. How do I claim the instant asset write-off?

Assets costing up to $20,000 must be purchased and installed by 30 June 2025.

3. How do I ensure super compliance?

Update payroll systems for the 11.5% SG rate and pay on time. Cosca’s payroll services can help.

4. What are the updated income tax brackets?

The 19% bracket applies to incomes up to $50,000, with further adjustments for higher brackets.

5. How do I stay compliant with ATO reporting rules?

Maintain accurate records of digital and crypto transactions. Cosca’s accounting experts can simplify the process.

Stay Ahead of Tax Changes with Cosca

Navigating tax updates can be challenging, but proactive planning ensures compliance and helps maximise savings. At Cosca, our expert business advisory, accounting, and personal wealth management services can simplify your finances and set you up for success.