August 2025 Newsletter

Please click on the following link to view this month's newsletter for August 2025. We would like to highlight the following article:-

HECS/HELP Debt Reduction Bill Introduced

On 23 July 2025, the Federal Government introduced a Bill aimed at reducing the financial burden of student debt. The key measures proposed include:

A one-off 20% reduction to HELP and certain other student loans incurred on or before 1 June 2025.
An increase in the minimum repayment threshold from $54,435 in 2024–2025 to $67,000 in 2025–2026.
A shift to a marginal repayment system, under which repayments are only calculated on income exceeding the $67,000 threshold.

These proposed changes build on earlier reforms that cap loan indexation to the lower of the Consumer Price Index (CPI) or Wage Price Index (WPI), ensuring student debts do not increase faster than wage growth.

ATO Interest Charges No Longer Deductible from 1 July 2025

From 1 July 2025, taxpayers will no longer be able to claim a tax deduction for interest charges imposed by the ATO on unpaid or underpaid tax liabilities. This includes both the General Interest Charge (GIC) and Shortfall Interest Charge (SIC).

Previously deductible, these charges will now represent a higher net cost to taxpayers that delay tax payments. The current GIC rate is 11.17%, and it is subject to quarterly review and compounds daily.

This change reinforces the need for timely tax compliance, as the financial penalty for late payment will increase with the removal of deductibility.

Please do not hesitate to contact us if you have any queries in relation to your tax and accounting matters.