Annual Indexation of Skilled Visa Income Thresholds: What Employers and Migrants Need to Know from 1 July 2025

From 1 July 2025, the Australian Government will implement a 4.6% increase in income thresholds for key skilled visa programs.

This adjustment aligns with the annual indexation policy based on the Average Weekly Ordinary Time Earnings (AWOTE), ensuring that skilled migrant wages keep pace with Australian labour market trends.

 As immigration lawyers at Morgan Clifford Legal Services in Aspley, we aim to provide clarity on these changes and their implications for both employers and prospective skilled migrants.

Understanding the Income Thresholds

The income thresholds serve as a benchmark to ensure that overseas workers are compensated fairly and are not underpaid compared to Australian workers in similar roles.

The key thresholds affected by the 4.6% increase are:

• Temporary Skilled Migration Income Threshold (TSMIT):
  Increasing from AUD 73,150 to AUD 76,515.
  
• Core Skills Income Threshold (CSIT):
  Also increasing from AUD 73,150 to AUD 76,515.
• Specialist Skills Income Threshold (SSIT):
  Rising from AUD 135,000 to AUD 141,210.
  

These thresholds apply to various visa subclasses, including the Subclass 482 (Temporary Skill Shortage), Subclass 186 (Employer Nomination Scheme), and Subclass 494 (Skilled Employer Sponsored Regional).

Implications for Employers

1. Reviewing Salary Packages:
   Employers must ensure that the salaries offered to prospective overseas workers meet or exceed the new thresholds or the annual market salary rate (AMSR), whichever is higher.
2. Budgeting for Increased Costs:
   The rise in thresholds may impact budgeting for positions intended to be filled by overseas workers. Employers should plan accordingly to accommodate these changes.
3. Timely Lodgement of Nominations:
   Nominations lodged before 1 July 2025 will be assessed under the current thresholds. Employers aiming to avoid the increased thresholds should ensure applications are submitted promptly.

Considerations for Skilled Migrants

1. Understanding Eligibility:
   Prospective migrants should assess whether their offered salary meets the new thresholds to ensure eligibility for the desired visa subclass.
2. Financial Planning:
   With higher income thresholds, migrants may need to negotiate better salary packages or consider alternative pathways if the offered salary falls short.
3. Application Timing:
   Submitting visa applications before 1 July 2025 could be advantageous for those whose salaries meet the current thresholds but not the increased ones.

Rationale Behind the Increase

The annual indexation of income thresholds is designed to:

• Maintain Fair Wage Standards:
  Ensuring that overseas workers are not exploited and receive wages comparable to Australian workers.
  
• Protect the Local Labour Market:
  Preventing the undercutting of wages and job opportunities for Australian citizens.
  
• Attract High-Quality Talent:
  By offering competitive salaries, Australia aims to attract skilled professionals who can contribute significantly to the economy.

How Morgan Clifford Legal Services Can Assist

Navigating the complexities of immigration law and understanding the implications of policy changes can be challenging. At Morgan Clifford Legal Services, we offer:

• Personalised Consultations:
  Assessing individual circumstances to provide tailored advice.
• Application Assistance:
  Guiding both employers and migrants through the nomination and visa application processes.
• Compliance Support:
  Ensuring that all applications meet the latest regulatory requirements to avoid delays or rejections.

Annual Indexation of Skilled Visa Income Thresholds

The upcoming increase in skilled visa income thresholds reflects Australia’s commitment to fair labour practices and a robust migration system.

Both employers and prospective migrants must stay informed and prepared for these changes.

For professional guidance and support, contact Morgan Clifford Legal Services in Aspley. Our experienced immigration lawyers are here to assist you every step of the way.