Upcoming Tax Cuts: How Much Will You Save?

While much of the Budget conversation has focused on proposed changes to capital gains tax and Family Protection Trusts, a quieter story has been unfolding.

Personal income tax rates are continuing to fall.

The numbers

For taxable income between $18,201 and $45,000, the current tax rate is 16%.

From 1 July 2026, that rate drops to 15%.

From 1 July 2027, it falls again to 14%.

These cuts combine with the proposed Working Australians Tax Offset announced in the Budget to deliver ongoing relief for lower and middle-income earners.

What this means in practice

For individual employees, the savings may appear modest in any single year.
But compounding across multiple years — and across multiple family members — the picture can look quite different.

For families with businesses, these rate reductions create a useful planning consideration.

Many family groups legitimately employ adult children, spouses or other family members in genuine roles. Lower marginal tax rates mean after-tax income in those hands improves automatically — without any additional planning required.

Don’t overlook the incremental wins

It’s easy to focus on the big strategic moves: trust structures, SMSFs, investment property decisions.

But sustainable wealth is also built through consistently capturing every advantage available.

These tax cuts are legislated separately from many of the larger Budget reforms. They should not be overlooked amid all the discussion about proposed CGT and negative gearing changes.

Sometimes the light is already on. You just need to notice it.

Want to talk through what this means for your situation? We’re always only one call away.

Book a conversation with the Lighthouse team → hello@lha.au · 02 9055 1330