New Year, New Money Rules: The Big ATO, Centrelink and Super Changes Hitting Australians from January 1, 2026
Australia has entered 2026 with a suite of significant changes to tax, Centrelink, superannuation and everyday costs that will affect almost every household’s budget. From higher welfare payments and cheaper medicines to payday super and tougher rules on supermarket pricing, the reforms are designed to ease cost-of-living pressures and tighten protections for consumers.
Higher Centrelink payments
More than one million Australians on Centrelink are receiving a boost to their fortnightly income from 1 January 2026, thanks to indexed rate rises and higher income thresholds. Students on Youth Allowance and ABSTUDY, as well as people on Youth Disability Support Pension and Carer Allowance, are among the main winners, with a single person on the maximum Youth Allowance now able to receive $684.20 per fortnight and carers $162.60 per fortnight.
These changes are intended to help low-income Australians keep pace with rising rents, food and transport costs. The government has also lifted some parental income test thresholds, allowing more students to qualify for support or receive higher payments.
Cash, childcare and household costs
A new cash-acceptance mandate now requires major supermarkets and petrol stations to take cash for in-person purchases of $500 or less between 7am and 9pm, with smaller businesses under $10 million turnover generally exempt. The move is aimed at protecting people who still rely on cash, including older Australians and those in regional areas, from being shut out of essential services.
From 5 January, eligible families receiving the Child Care Subsidy are entitled to three days of subsidised care per week, as the government scraps the activity test linking support to parents’ work or study hours. More than 100,000 families are expected to gain extra subsidised hours, with typical households earning between $80,000 and $100,000 forecast to save around $1,460 a year.
Health, medicines and dental changes
The Medicare Safety Net thresholds for out-of-pocket costs have been lifted, meaning patients need to spend more before Medicare covers 100 per cent of the schedule fee, but these thresholds continue to be indexed to reflect inflation. The Extended Medicare Safety Net now kicks in at $861.20 for concession card holders and Family Tax Benefit Part A recipients, and $2,699.10 for others.
At the pharmacy, the maximum co-payment for PBS-listed medicines for non-concession patients has dropped from $31.60 to $25, easing pressure on people with regular scripts. Families also get a modest boost in dental support, with the Child Dental Benefits Schedule increasing to $1,158 over two years for eligible children.
Work, tax and superannuation
Government support for new apprentices in priority occupations is being scaled back, with incentive payments for apprentices and their employers cut for those starting from 1 January 2026, while existing apprentices remain on the old, higher rates. The change reflects a refocusing of skills funding, but may reduce the financial appeal of starting a trade for some workers.
From 1 July 2026, “payday superannuation” will begin, compelling employers to pay super at the same time as wages rather than quarterly, tightening compliance and helping workers’ balances grow faster. On the same date, a tax cut will reduce the 16 per cent income tax rate to 15 per cent for a middle-income bracket, with a further cut to 14 per cent scheduled for 1 July 2027, benefiting around 14 million taxpayers.
New rules for big business and high-balance super
Large supermarket chains with annual revenue above $30 billion, currently Coles and Woolworths, will face a new ban on “price gouging” from 1 July 2026, with penalties of up to $10 million per breach, three times the benefit gained or 10 per cent of annual turnover. The laws are designed to crack down on excessive mark-ups during a period of high cost-of-living stress and growing scrutiny of supermarket profits.
From 1 July 2026, superannuation tax rules will also tighten for very high balances, with earnings on balances between $3 million and $10 million taxed at 30 per cent and those above $10 million at 40 per cent, both indexed over time. The Reserve Bank of Australia is separately reviewing a proposed nationwide ban on card payment surcharges for EFTPOS, Mastercard and Visa, a move that could save consumers and businesses an estimated $1.2 billion a year if implemented after its review concludes in March 2026.
English