Tax Planning
Maximising Low-Income Super Tax Offset (LISTO): Planning Tips for Australians
The Australian Government is boosting LISTO eligibility and payments. Here’s how low-income earners can make the most of the changes with planning examples.
By NomadicTax Research Team • 5 min read • November 24, 2025
## Introduction to LISTO and Its Recent Reforms
The **Low Income Super Tax Offset (LISTO)** is designed to refund the **15% contributions tax** for low-income earners so their super savings aren’t eroded by tax. Recent reform efforts intend to adjust both the **income eligibility threshold** and **maximum refund amount**, starting mid-2027. Although the ATO hasn’t published all implementation details yet, these proposed changes are expected to significantly impact low-income super fund members.([theguardian.com](https://www.theguardian.com/australia-news/2025/oct/15/millions-of-lower-income-workers-in-australia-are-set-to-benefit-from-proposed-super-changes-heres-why?utm_source=openai))
### What We Know So Far
- Current LISTO threshold: **$37,000** income; maximum refund of **$500**.([theguardian.com](https://www.theguardian.com/australia-news/2025/oct/15/millions-of-lower-income-workers-in-australia-are-set-to-benefit-from-proposed-super-changes-heres-why?utm_source=openai))
- Proposed changes: Threshold raised to **$45,000**, refund cap to **$810**, from **1 July 2027** to align with new tax bracket cuts.([reuters.com](https://www.reuters.com/world/asia-pacific/australia-overhauls-plan-hike-taxes-retirement-savings-wealthy-2025-10-13/?utm_source=openai))
- Estimated that around **1.3 million people** will benefit under the expansion in eligibility and increased offsets.([reuters.com](https://www.reuters.com/world/asia-pacific/australia-overhauls-plan-hike-taxes-retirement-savings-wealthy-2025-10-13/?utm_source=openai))
## Practical Planning Tips
- **Monitor your income levels**: If you're near the old LISTO threshold and expect income growth, plan contributions to stay below or just above thresholds to maximise refund.
- **Make extra concessional contributions**: If eligible, these can boost your super balance now and later offset contributions tax when LISTO expands.
- **Super timing**: Contributions before 1 July 2027 will still be under the old rules; strict timing may yield marginal benefits.
- **Document your income sources**: Ensure all income is correctly reported so you qualify; unreported income could disqualify you.
## Example Scenarios
- **Employee A**, earning $40,000 a year, currently not eligible under the $37,000 threshold, but under proposed changes would now qualify and could receive up to $810 back into their super.
- **Part-time worker or casual worker** whose earnings fluctuate year to year should consider structuring overtime or extra work earlier (before threshold increases) to maximise benefit.
## Caveats & Things to Watch
- These proposals **still require legislation**; details may change during drafting and through parliamentary processes.
- Budgetary impact and ATO capacity may influence what helps low-income workers more quickly.
- Changes to tax rates and brackets (including planned cuts reducing lowest rate to 14% from July 2027) will affect overall tax burdens and might lead to unintended interactions.([ato.gov.au](https://www.ato.gov.au/about-ato/new-legislation/in-detail/individuals/personal-income-tax-new-tax-cuts-for-every-australian-taxpayer?utm_source=openai))
**Category:** Tax Planning | Compliance
For many low-income Australians, these reforms offer an overdue relief. By planning now, keeping accurate records, and keeping tabs on your income and contributions, you can ensure you make the most of LISTO’s expansion when it takes effect in mid-2027.