Staying Ahead of Financial Year Changes
Every 1 July brings a fresh wave of regulatory and tax changes that can catch businesses off guard – particularly those operating in Australia’s creative and production industries. From superannuation rate increases that directly affect crew costs to shifts in tax brackets that change what freelancers take home, staying informed is not just good practice but essential for running a profitable business.
That is why Blake and the Count Out Loud team compile this annual summary each financial year. Rather than letting clients scramble to understand how new rules affect their bottom line, we break down the key changes well before they take effect. This page is updated every July so you always have a single, reliable reference point for what has changed and what to prepare for.
Whether you are a production company budgeting for the next season, a freelance creative reviewing your tax position, or a small business owner planning cash flow, this guide covers the changes that matter most. If you need tailored advice on how any of these changes affect your specific situation, our accounting and advisory services are built for exactly that.
2025-2026 Financial Year Changes (From 1 July 2025)
The 2025-26 financial year marks the arrival of a significant milestone: the superannuation guarantee has reached its legislated target of 12%. Here are the key changes businesses need to know about.
Superannuation Guarantee Hits 12%
The superannuation guarantee (SG) rate has increased from 11.5% to 12% from 1 July 2025. This is the final step in the phased increase that began back in 2021 when the rate was 9.5%. For employers, this means higher payroll costs across the board. Production companies running crew-heavy projects should factor this into every budget going forward, as the rate is now at its permanent legislated level.
The maximum super contribution base for 2025-26 is $62,500 per quarter. Employers are not required to pay the SG on earnings above this threshold, though they may choose to do so.
Stage 3 Tax Cuts Fully in Effect
The revised Stage 3 tax cuts that commenced on 1 July 2024 continue to apply for the 2025-26 year. No further changes to income tax rates or thresholds have been introduced for this financial year, giving businesses and individuals a period of stability. The current rates remain:
- 0% on taxable income up to $18,200
- 16% on $18,201 to $45,000
- 30% on $45,001 to $135,000
- 37% on $135,001 to $190,000
- 45% on income above $190,000
Note that from 1 July 2026, the 16% rate for the $18,201 to $45,000 bracket will be reduced to 15%, with a further reduction to 14% from 1 July 2027.
Payday Super Preparation (Commencing 1 July 2026)
While payday super does not officially start until 1 July 2026, the 2025-26 year is the critical preparation window. From next financial year, employers will need to pay super contributions at the same time as wages, with payments reaching the employee’s fund within seven business days. This replaces the current quarterly payment cycle.
Blake recommends that all employers begin reviewing their payroll systems now. Key preparation steps include:
- Confirming your payroll software is payday super ready
- Reviewing clearing house arrangements (the ATO’s Small Business Superannuation Clearing House will close from 1 July 2026)
- Running cash flow forecasts to understand the impact of more frequent super payments
- Speaking with your accountant about transition planning
Late super payments are not tax deductible and can trigger the Superannuation Guarantee Charge, which includes interest and penalties that are also non-deductible. Getting ahead of this change is essential.
$20,000 Instant Asset Write-Off Extended
The $20,000 instant asset write-off threshold has been extended for the 2025-26 financial year. Small businesses with aggregated turnover under $10 million can immediately deduct the full cost of eligible depreciating assets costing less than $20,000 each, provided the asset is first used or installed ready for use before 30 June 2026. The threshold applies on a per-asset basis, so multiple purchases can each qualify.
For production companies and creative businesses, this is particularly useful for equipment purchases such as cameras, lighting rigs, editing workstations and audio gear. Unless the government extends the measure again, the threshold will revert to $1,000 from 1 July 2026.
STP Phase 2 Fully Operational
Single Touch Payroll (STP) Phase 2 is now the standard reporting method for all employers, with the ATO having shifted its focus from education to enforcement. Transitional grace periods have ended, and businesses that fail to meet their disaggregated reporting obligations can face significant penalties. Every employer should ensure their payroll system is producing compliant STP Phase 2 reports that separately itemise salary, overtime, allowances, leave payments and other components.
Digital Games Tax Offset and Screen Production Offsets
The Digital Games Tax Offset (DGTO) continues in its second full year of operation, providing a 30% refundable tax offset on eligible Australian development expenditure for qualifying game developers. This remains a significant incentive for the growing Australian games industry.
The screen production offset rates remain stable for 2025-26. The Location Offset sits at 30% for large-budget productions shot in Australia (minimum $15 million budget for features), and the Post, Digital and Visual Effects (PDV) Offset also remains at 30% (minimum $500,000 qualifying Australian production expenditure). No changes to eligibility thresholds or rates have been introduced for this year. For businesses in the film and television production space, these offsets continue to make Australia a competitive destination for both domestic and international projects.
Interest Deduction Changes
From 1 July 2025, taxpayers can no longer claim a tax deduction for General Interest Charge (GIC) or Shortfall Interest Charge (SIC) on outstanding tax liabilities. These interest costs are now entirely out-of-pocket expenses. This makes it more important than ever to lodge and pay on time to avoid non-deductible charges stacking up.
2024-2025 Financial Year Changes
The 2024-25 financial year introduced several major changes that continue to affect businesses today.
Superannuation Rate Increased to 11.5%
The SG rate rose from 11% to 11.5% from 1 July 2024, continuing the phased increase schedule. This was the penultimate step before reaching the 12% target in 2025-26.
Stage 3 Tax Cuts Commenced
The revised Stage 3 tax cuts took effect from 1 July 2024, delivering tax relief to all 13.6 million Australian taxpayers. The key changes were:
- The 19% rate was reduced to 16% for income between $18,201 and $45,000
- The 32.5% rate was reduced to 30% for income between $45,001 and $135,000
- The 37% threshold was lifted from $120,000 to $135,000
- The 45% threshold was lifted from $180,000 to $190,000
These changes were automatically applied by employers through their payroll systems, increasing take-home pay from the first pay period after 1 July 2024.
$20,000 Instant Asset Write-Off
The $20,000 instant asset write-off threshold applied for the 2024-25 year, maintaining the temporary increase from the previous $1,000 limit. This was subsequently extended into 2025-26 as noted above.
Small Business Energy Incentive
The Small Business Energy Incentive provided a 20% bonus tax deduction on eligible assets supporting electrification and energy efficiency for expenditure incurred between 1 July 2023 and 30 June 2024. This incentive has now closed and was not extended into 2024-25 or beyond. Businesses that made qualifying purchases during the eligible period can still claim the bonus deduction in their 2023-24 tax returns.
STP Phase 2 Enforcement
The ATO transitioned from an education-first approach to active enforcement of STP Phase 2 compliance during 2024-25. Employers who had been operating under transitional concessions were required to move to full compliance with the disaggregated reporting requirements.
2021-2022 Financial Year Changes
The 2021-22 financial year brought several foundational changes, many of which set the stage for the reforms that have followed. This section preserves the key information from our original July 2021 update.
Superannuation Rate Increased to 10%
From 1 July 2021, the superannuation guarantee rate increased from 9.5% to 10%, marking the first step in the gradual increase to 12%. This was a significant moment – the SG rate had been frozen at 9.5% since 2014, and the increase signalled the beginning of a schedule that would see it rise by 0.5% each year through to July 2025.
Employers needed to review payroll costs, check salary packaging arrangements and update budgets to reflect the higher rate. For production companies with large casual or contract workforces, this had a direct impact on crew costs for every project.
Removal of $450 Per Month Super Threshold
Previously, employers were not required to pay superannuation for employees who earned less than $450 per month. This threshold was removed from 1 July 2022, meaning all employees became entitled to super regardless of how much they earned. This was particularly relevant for businesses employing casual or part-time workers in the creative industries, where short engagements and variable hours are common.
Self-Education Expense Changes
The $250 non-deductible threshold for self-education expenses was removed, allowing taxpayers to claim the full amount of eligible self-education costs from the first dollar. This benefited professionals investing in skills development and training relevant to their current employment or business.
Work From Home Deduction Changes
Following the shift to remote work during the pandemic, the ATO updated the methods available for claiming work from home deductions. The temporary shortcut method (80 cents per hour for all running expenses) was available during this period, alongside the fixed-rate method and the actual cost method. These rules continued to evolve in subsequent years as working patterns settled into a new normal.
Company Tax Rate Reduction for Base Rate Entities
The company tax rate for base rate entities dropped to 25% from 1 July 2021, completing a multi-year reduction from 30%. A base rate entity is broadly defined as a company with aggregated turnover under $50 million where no more than 80% of assessable income is base rate entity passive income. Many small and medium production companies and creative businesses qualified for this lower rate.
Single Touch Payroll for Closely Held Employees
The STP exemption for closely held employees (typically directors, shareholders and their family members) came to an end on 30 June 2021. From 1 July 2021, these employees needed to be reported through STP, with three reporting options available: reporting actual payments on or before the payment date, reporting actual payments quarterly, or reporting a reasonable estimate quarterly. This was an important compliance step for family-run businesses in the creative sector.
What Creative Industry Businesses Should Watch Each July
Blake puts together this checklist each year to help creative and production industry clients focus on the changes that matter most to their operations. Here is what to review every time a new financial year begins:
- Superannuation rate changes – Even small percentage increases directly impact crew costs on every production. Budget accordingly and update payroll systems before the new rate takes effect.
- Tax bracket and rate changes – Shifts in personal income tax rates affect what freelancers and contractors take home, which can influence rate negotiations and workforce availability.
- Instant asset write-off thresholds – Changes to the write-off threshold affect the timing and tax benefit of equipment purchases such as cameras, lighting, editing suites and sound gear.
- Screen offset rate or eligibility changes – Any adjustments to the Producer Offset, Location Offset, PDV Offset or the Digital Games Tax Offset can significantly change the financial viability of projects.
- STP and payroll reporting changes – New reporting requirements or enforcement changes can mean software updates, process changes and potential penalties for non-compliance.
- GST and BAS lodgement changes – Adjustments to GST thresholds, reporting frequencies or lodgement deadlines can affect cash flow planning and administrative workload.
- Workers compensation premium changes – Premium rates are reviewed annually by state and territory insurers. Changes can affect the cost of engaging employees, particularly on crew-intensive productions.
- State-level changes including payroll tax thresholds – Each state sets its own payroll tax rates and thresholds. Businesses operating across multiple states (common in film and television) need to track changes in every jurisdiction where they have a payroll obligation.
Bookmark this page and check back each July when we update it with the latest changes. If you want personalised advice on how any of these items affect your business, get in touch with our team.
How Count Out Loud Helps
At Count Out Loud, we specialise in accounting and business advisory for Australia’s creative and production industries. Blake and the team work closely with production companies, freelancers and creative businesses throughout the year to make sure they are not just aware of changes but actively prepared for them.
From payroll compliance and superannuation management to tax planning and offset claims, our services are tailored to the unique needs of the entertainment and creative sector. We do not just process numbers – we help you understand what the numbers mean for your next project, your cash flow and your long-term business strategy.
If you have questions about any of the changes listed on this page, or if you want to make sure your business is set up to handle the next financial year smoothly, give us a call on (02) 9043 1525 or reach out through our contact page. We are always happy to chat.