As well as heralding the start of 2025, 1 January will also see a raft of changes to payments, taxes, and laws.

Here’s a rundown of what could affect your hip pocket from midnight.

Centrelink payments to rise

Some government payments for young Australians will increase in line with indexation, including Youth Allowance, Austudy, Abstudy, and the Disability Support Pension for under 21s.

The maximum basic rate of Youth Allowance for singles over 18 who live away from home will increase by $24.30 a fortnight to $663.30.

Those who live at home will get another $17.30 a fortnight, taking the payment to $472.50.

Student payments boost

Austudy and Abstudy recipients will also see increased payments from 1 January.

Singles with no dependent children will receive an extra $24.30 in Austudy payments to $663.30 a fortnight.

Those partnered with children will get $718.10 a fortnight.

Carers will also receive an extra $5.80 a fortnight.

The Department of Social Services provides a full list of the changes as well as higher income test limits that come into effect on 1 January.

Not all welfare payments to rise

It’s important to note that not all government payments are increasing.

Many are automatically increased on 20 March and 20 September in line with CPI indexing.

This includes the age pension, for example.

The 1 January increases are expected to boost payments to around a million Australians and will be automatically applied.

Medicare safety net increases

The amount you’re required to spend on out-of-hospital medical costs before being eligible for a higher Medicare rebate will increase to $576 – up from $560.40.

This means once any gap expenses reach that amount in a calendar year, Medicare will cover the full costs of any ongoing out-of-hospital expenses.

The Extended Medicare Safety Net threshold will also increase to $834.50 for concession card holders.

The extended safety net applies to out-of-pocket expenses (as opposed to gap expenses) with the government covering 80% of all further out-of-pocket expenses within the calendar year.

The additional coverage will be automatically applied once the thresholds have been met.

Conditions are outlined under the Medicare Benefits Schedule.

Passports to cost more

Australians already have among the most expensive passports in the world but from 1 January, Australian citizens will pay around another $14 to $412 for a new 10-year passport.

This change now makes Australia's passport the most expensive in the world.

The exact amounts are due to be published on 1 January on the Australian Passport Office website.

The annual indexation comes on top of a 15% price hike which applied from 1 July 2024.

Pay rise for aged care workers

Workers in the aged care sector will get a pay boost from 1 January with the amount depending on their roles.

Direct care workers will receive half their 13% cumulative increase on 1 January and the remainder on 1 October.

Workers involved in indirect care for the aged will receive lower pay rate increases.

New wage theft laws

On the topic of pay, new laws come into effect on 1 January criminalising the intentional underpayment of wages.

Employers found to deliberately underpay their staff will be subject to major fines and can face up to 10 years in jail.

The offences will cover underpayments made from 1 January so it may be worth mentioning to your employer. 

The Fair Work Ombudsman provides details. 

Medicine costs stay the same

One thing that won’t rise as usual from 1 January is the cost of medicines listed on the Pharmaceutical Benefits Scheme.

These are usually increased in line with inflation each year but will be frozen at their current prices for all Australians for 2025.

Concession card holders won’t see any move to prices until 1 January 2030.

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