Key money changes in 2026: What you need to know
A new year always brings a fresh batch of policy changes, and 2026 is no exception. Some have already kicked in, while others will roll out later in the year, but many have the potential to impact household budgets.
Some government payments, including Youth Allowance, Austudy and Carer Allowance, have increased thanks to indexation. And certain medications have gotten cheaper, with PBS prescription medicines now capped at $25 per script, down from $31.60.
On the flip side, a 10-year adult passport will now set you back $10 more and energy rebates have come to an end.
Beyond those headline items, here are five other changes worth watching this year.
Tax cuts kick in from July
A new round of tax cuts will flow through from 1 July, with the tax rate on incomes between $18,201 and $45,000 dropping from 16% to 15%. The government estimates this will give Aussies up to $268 extra a year, or roughly $5 a week. A further cut to 14% is scheduled for July 2027.
Payday super becomes a reality
From 1 July, employers will be required to pay super at the same time as wages rather than quarterly.
For workers, this means super hits your account sooner and starts compounding earlier. Over a full career, that timing difference could add thousands to your retirement balance.
Industry body ASFA has crunched the numbers and found that a 25-year-old on an average wage would be around $5,000 better off at retirement if super is paid fortnightly instead of quarterly.
The $3 million super tax arrives
It's been a hot topic for a while, but the $3 million super tax is now slated to start from 1 July. Investment earnings linked to super balances above $3 million would be taxed at 30%, while returns on balances above $10 million would face a total tax rate of 40% - up from the current 15%.
Earnings on anything below the $3 million threshold would still be taxed at the usual concessional rate of 15%, or not taxed at all if the balance sits in a pension account.
It's worth noting the changes aren't law yet, so the final details will depend on what makes it through parliament.
Paid parental leave gets longer
From July, eligible parents will be able to access 26 weeks of government-funded paid parental leave, up from 24 weeks.
Another positive for new parents is that super contributions funded by the government will also continue to be paid on parental leave. It might not change day-to-day cash flow, but it helps reduce the long-term super gap that often opens up when parents take time out of the workforce.
To put that into context, 26 weeks of paid parental leave at the minimum wage would attract around $3,000 in super contributions. Left invested over time, that amount can grow into a much larger boost to retirement savings.
Three-day childcare guarantee begins
Families eligible for the Child Care Subsidy are now guaranteed access to at least three days of subsidised childcare per week, regardless of how much they work or study.
The change kicked in on 5 January and removes the need to meet minimum work or study requirements to get those days of care each week.
More than 100,000 families are expected to gain access to extra subsidised hours, making it easier to juggle work, study, and caring responsibilities.
Frequently Asked Questions about this Article…
Several 2026 changes could touch household budgets: some government payments (like Youth Allowance, Austudy and Carer Allowance) have been indexed up, PBS prescription medicines are now capped at $25 per script (down from $31.60), a 10-year adult passport costs $10 more, and some energy rebates have ended. Other major changes (tax cuts, super rules, parental leave and childcare guarantees) roll out later in the year.
From 1 July 2026 the tax rate on incomes between $18,201 and $45,000 drops from 16% to 15%, which the government estimates could give eligible Australians up to $268 extra a year (around $5 a week). A further cut to 14% is scheduled for July 2027.
Payday super requires employers to pay superannuation at the same time as wages (from 1 July 2026) instead of quarterly. That means your super contributions start compounding sooner. Industry modelling (ASFA) suggests a 25-year-old on an average wage could be about $5,000 better off at retirement if super is paid fortnightly rather than quarterly.
The so-called $3 million super tax is slated to begin on 1 July 2026. Under the proposal, investment earnings linked to super balances above $3 million would be taxed at 30%, and returns on balances above $10 million would face a total tax rate of 40% (up from the current 15%). Earnings below $3 million would still be taxed at the usual concessional rate of 15% or remain tax-free if in a pension account. These changes are not law yet and depend on what passes through parliament.
From July 2026 eligible parents will get 26 weeks of government-funded paid parental leave, up from 24 weeks. The government will continue making super contributions on paid parental leave, which helps reduce the long-term super gap that can occur when parents take time out of the workforce. For example, 26 weeks at minimum wage would attract around $3,000 in super contributions.
The three-day childcare guarantee, which started on 5 January 2026, guarantees families eligible for the Child Care Subsidy access to at least three days of subsidised childcare per week regardless of how much they work or study. More than 100,000 families are expected to gain extra subsidised hours, making it easier to balance work, study and caring responsibilities.
Indexation increases have lifted payments such as Youth Allowance, Austudy and Carer Allowance. Meanwhile, PBS prescription medicines are now capped at $25 per script (reduced from $31.60), making some medications cheaper for patients.
Yes. A 10-year adult passport now costs $10 more, and some energy rebates have ended, which could affect household energy bills. Keep an eye on your utility statements and government communications for details on the rebate changes.
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