The New TSMIT 2025-26 Changes:What Employers and Skilled Migrants Must Know

The Australian skilled migration landscape has shifted once again. As of 1 July 2025, the Temporary Skilled Migration Income Threshold (TSMIT) has increased from $73,150 to $76,515—representing a 4.6% increase that has significant implications for employers sponsoring skilled workers and migrants planning their employment-based pathways to Australia.

For employers, this means recalibrating salary budgets and potentially reconsidering which roles remain viable for visa sponsorship. For skilled migrants, it signals evolving opportunities and new strategic considerations around which pathways offer the best cost-benefit analysis. This comprehensive guide walks through everything you need to know about the TSMIT changes, how they affect your sponsorship strategy, and what steps you should take now.

Understanding the TSMIT: The Foundation

The TSMIT is the baseline minimum annual salary that employers must offer when sponsoring foreign skilled workers under most employer-sponsored visa programs. Think of it as a government-mandated floor that protects Australian workers by ensuring overseas employees aren't undercutting local wages.

The TSMIT isn't just a random number—it's indexed annually in line with changes to the Average Weekly Ordinary Time Earnings (AWOTE). The 4.6% increase effective from 1 July 2025 reflects wage growth across the Australian economy. This indexation mechanism means the threshold will likely continue rising each year, making it a moving target that employers need to monitor carefully.

Importantly, the TSMIT applies to nominations lodged on or after 1 July 2025. If an employer lodged a nomination before that date, the old threshold of $73,150 continues to apply to that specific application. This creates a timing consideration for employers who may have strategically lodged nominations before the increase took effect.

Which Visa Programs Are Affected?

The TSMIT increase impacts several employer-sponsored visas, with the effect varying by subclass and application date. 

• The new $76,515 threshold directly affects the Subclass 494 (Skilled Employer Sponsored Regional visa), requiring employers to pay this amount for regional positions. 

• The Subclass 187 (Regional Sponsored Migration Scheme visa) also applies this new threshold, impacting salary offers for new nominations. 

• For the Subclass 482 (Skills in Demand visa), the Core Skills Income Threshold (CSIT) is updated to $76,515 for nominations lodged after July 1, 2025. 

• The Subclass 186 (Employer Nomination Scheme visa) uses the $76,515 CSIT for Core Skills stream nominations lodged on or after December 7, 2024, while earlier nominations operated under an older framework. 

• The Specialist Skills Income Threshold (SSIT) for high-earning positions has increased to $141,210.

How the TSMIT Works: The Full Salary Picture

Here's where many employers and prospective migrants misunderstand the salary requirements. The TSMIT is not the only salary consideration—it works in conjunction with another critical component called the Annual Market Salary Rate (AMSR).

When nominating a worker for a salary below $250,000, employers must meet three conditions simultaneously:​

1.  Meet or Exceed the TSMIT
   The guaranteed annual earnings offered to the overseas worker must be at least $76,515 (as of 1 July 2025). This is the absolute floor—no exceptions.​

2. Meet or Exceed the Annual Market Salary Rate (AMSR)
   The employer must accurately determine what an equivalent Australian worker would reasonably earn in the same role, location, and industry. The AMSR becomes the second salary benchmark. If the AMSR for an IT project manager in Sydney is $90,000, then the overseas worker must be paid at least $90,000, even though $76,515 meets the TSMIT.​

3. Pay the Higher of the Two Thresholds
   This is the critical insight: employers must offer whichever is higher—the TSMIT or the AMSR. If the AMSR is $85,000, the employer pays $85,000. If the AMSR is $65,000 (hypothetically), the TSMIT of $76,515 becomes the binding minimum.​

This layered approach ensures overseas workers aren't exploited while also protecting Australian workers from wage-undercutting competition. It's the government's way of maintaining labor market integrity.

Determining the Annual Market Salary Rate: A Practical Guide

AMSR determination is a common reason for nomination application refusals due to poor documentation.

How to Determine AMSR:

• Equivalent Australian Worker Exists: Use the salary of an Australian employee with equivalent experience and qualifications in the same role. Longer tenure or seniority makes a worker non-equivalent.

• No Equivalent Worker, But Industrial Awards/Enterprise Agreements Exist: Reference Fair Work Commission-registered agreements or awards, identify the relevant pay grade, and show the nominated position fits.

• No Equivalent Worker, Award, or Agreement (Most Common): Determine AMSR using at least two of these sources, ensuring documentation is specific to the role, location, and current market:

• Job Outlook information (Australian Department of Employment)

• Job advertisements (past 6 months, same position/geographic area)

• Remuneration surveys (reputable organizations/industry bodies)

• Written advice (unions/professional associations)

Generic national average salary data is insufficient; local market investigation is required.

The Financial Impact: What This Means for Employers

Let's translate the TSMIT increase into real business impact. The jump from $73,150 to $76,515 represents approximately $3,365 additional annual cost per sponsored worker. On the surface, this might seem modest—roughly $3.33 per day. However, the implications compound across multiple dimensions.

Nomination and Visa Application Costs

Beyond salary considerations, visa application fees themselves have also increased. The Temporary Skill Shortage visa (482) fee increased from $2,770 to $2,855, while the Employer Nomination Scheme (486) fee rose from $4,840 to $4,985. These additional costs apply to all nominations lodged from 1 July 2025 onwards.​

For an employer sponsoring multiple workers annually, the cumulative cost impact becomes material. A mid-sized business sponsoring 10 skilled workers faces:

• Additional salary costs: $33,650 per year (if all existing salaries were at the previous TSMIT)

• Increased visa application fees: Additional $850+ across new nominations

Reassessment of Current Nominations

Employers with already-approved nominees aren't automatically affected—the TSMIT applies only to new nominations lodged after 1 July 2025. However, employers should review their nomination pipelines. Roles previously viable for sponsorship with $73,150 salary offerings may no longer work financially.

Some employers have found roles on the occupational list that don't align well with realistic market salaries at the previous threshold level. The TSMIT increase has prompted strategic reconsideration: is this role genuinely critical enough to justify sponsoring at the new salary level? Can the business absorb a 4.6% salary increase on top of existing payroll?

Strategic Considerations for Employers: Planning for 2025-26 and Beyond

Budget Now, Sponsor Later

Before lodging new nominations, employers should model their payroll impact at the new salary thresholds. A 4.6% increase might seem manageable in isolation, but combined with other wage pressures and anticipated future indexation, the ongoing commitment requires careful planning.

Additionally, employers should consider the three-year commitment inherent in many sponsorships. Sponsoring a worker for a provisional visa (like the 494 or provisional 487) creates ongoing compliance obligations. If that worker transitions to permanent residency, the employer's obligations continue. Underestimating long-term salary commitment is a common mistake.

Review Your Occupational Mix

The TSMIT increase affects different occupations differently depending on their typical market salaries. Roles where the AMSR significantly exceeds the TSMIT (like specialized engineers or senior professionals) experience minimal proportional impact. Roles where the TSMIT was the binding constraint (lower-skilled roles on the occupational lists) face a more pronounced percentage increase in total cost.

Employers should audit their sponsorship pipeline: which roles are most affected by the threshold increase? Are there alternative pathways (such as the Graduate Visa 485 for recent university graduates, which doesn't have TSMIT requirements) that might be more cost-effective for certain positions?

Regional vs. Metropolitan Pathways

The Subclass 494 (regional sponsorship) and 482 (metropolitan sponsorship) both apply the same $76,515 threshold. However, regional sponsorship often provides clearer pathways to permanent residency through the subsequent 191 visa. For employers in regional areas, the slightly higher certainty of long-term employee retention might justify the higher salary commitment. Metropolitan employers should ensure the sponsorship benefits justify the salary investment, particularly given that metropolitan skilled worker supply is generally stronger.

Strategic Considerations for Skilled Migrants: Navigating Changing Pathways

For skilled workers aiming to migrate to Australia through employer sponsorship, the TSMIT increase sends mixed signals.

On One Hand: Positive Signals

The TSMIT increase suggests the Australian government continues indexing skilled migration compensation to reflect wage growth. The increase maintains real purchasing power for sponsored workers and demonstrates the government's commitment to preventing wage exploitation. For workers already in Australia or with confirmed job offers, this change doesn't immediately disadvantage them if their offers were already structured at reasonable market rates.

On the Other Hand: Increased Competition

The higher threshold makes sponsorship more expensive for employers, which may reduce the number of available sponsored positions. Employers operating on tight margins might defer sponsorship plans or reduce their target intake of sponsored workers. In a competitive market, this could make it harder for skilled migrants to secure sponsorship.

Strategic Recommendations for Migrants

• Secure Offers Early

If you're targeting employer-sponsored pathways, the earlier you secure a job offer, the better. Employers with approved sponsors and pending nominations may prioritize moving candidates through before salary thresholds increase further or before their budgets tighten.

• Develop Contingency Pathways

Don't rely solely on a single employer or visa type. Skilled migrants should understand multiple pathways:

• Provisional Regional Sponsorship (494): If willing to live regionally, this provides clear PR pathways after three years, though fewer positions may be available compared to metropolitan sponsorship.

• Direct Skilled Independent Migration (189): Though more competitive (requiring higher points and professional qualifications), this pathway bypasses sponsorship altogether and provides immediate permanent residency.

• State Sponsorship Streams: Many Australian states offer skilled migration sponsorship with different thresholds and occupational lists. Comparing state-specific pathways might reveal more accessible opportunities.

• Accumulate Evidence of Market Value

Workers with specialized skills, professional qualifications, or experience in high-demand occupations are more likely to attract sponsorship at the new salary levels. Building credential value—through additional certifications, relevant experience, or demonstrated expertise—increases your attractiveness to sponsors willing to invest at higher salary thresholds.

The Compliance Dimension: Obligations Beyond Nomination

The TSMIT threshold is just the entry point. Employers who successfully nominate workers carry ongoing compliance obligations that extend well beyond the nomination stage.

Verification of Ongoing Salary Compliance

Once a worker is sponsored, employers must ensure the worker is genuinely being paid the promised TSMIT and AMSR. Immigration compliance protocols require employers to maintain independently verifiable evidence that the worker is receiving the agreed salary. This typically includes payslips, superannuation contributions, and tax documents.​

The 12-Month Rule

For nominations approved more than 12 months prior, employers must actively verify that the sponsored worker is receiving the Annual Market Salary Rate through independent verification. This isn't a one-time compliance check—it's ongoing. Failing to maintain this evidence is considered a breach of sponsorship obligations and can result in sanctions, including sponsor cancellation.​

Equivalent Terms and Conditions

Employers must provide sponsored visa holders with equivalent terms and conditions of employment as they'd provide to Australian workers in the same role. This extends beyond salary to include benefits, leave entitlements, working conditions, and other employment terms. Courts have interpreted this requirement broadly to prevent any form of systemic disadvantage.​

Practical Steps: What to Do Now

For Employers:

1. Audit Current Salary Offerings: Review all roles you sponsor or plan to sponsor. Identify which roles are most affected by the TSMIT increase and model the payroll impact over three to five years.

2. Review Nomination Pipeline: Any nominations you planned to lodge should be reconsidered in light of the new thresholds. Reconfirm that roles remain viable at the new salary levels.

3. Update AMSR Determinations: If you've already determined AMSR for roles in your pipeline, revisit these. Market salary rates may have shifted, and you want current documentation ready for immigration assessments.

4. Verify Compliance Systems: Ensure your payroll and HR systems can generate the independently verifiable evidence of salary compliance that immigration authorities expect.

5. Consider Timing: If you were planning sponsorships, weigh the trade-offs of lodging before versus after 1 July 2025. Generally, if a nomination was ready before the threshold increase, there was value in lodging earlier—unless you hadn't yet determined the AMSR, in which case the timing advantage disappears.

For Skilled Migrants:

1. Accelerate Offer Pursuit: If targeting employer sponsorship, prioritize securing job offers now. The window for offers based on pre-increase salary thresholds is closing.

2. Evaluate Multiple Pathways: Research state sponsorship programs, regional visa options, and skilled independent migration alternatives. Don't put all focus on a single employer-sponsored pathway.

3. Build Credential Value: Pursue additional certifications, professional memberships, or specialized skills that increase your market value and make sponsorship more attractive to employers.

4. Document Market Salaries: If currently employed in your field, understand what equivalent Australian workers earn. This information will be valuable in future sponsorship negotiations.

Looking Forward: The Trajectory of Skilled Migration Policy

The TSMIT increase sits within a broader policy context worth understanding. The Australian government has signaled its priority for employer-sponsored skilled migration as a percentage of the total migration program. Recent migration program planning levels designated 44,000 places specifically for employer-sponsored visas out of 185,000 total permanent migration places—a significant proportion.​

This emphasis on employer sponsorship suggests:

• Continued indexation likely: The government will probably continue indexing income thresholds annually, meaning employers should expect regular salary increases for sponsored roles.

• Occupational list evolution: As occupational lists are refined, some roles may be removed or new roles added, shifting which positions are even eligible for sponsorship.

• Regional emphasis: The government's focus on distributing population growth to regions suggests regional sponsorship pathways (494, 187) may receive more favorable policy treatment, potentially expanding opportunities in regional areas.

• Skills specificity: Sponsorship increasingly requires genuine skill shortages and roles where employers can't source Australian workers. Generic or easily-filled positions face increasing scrutiny.

The TSMIT increase from $73,150 to $76,515 is far more than a simple wage adjustment—it's a signal of the evolving economics of skilled migration and a recalibration point for employers and workers relying on sponsorship pathways. For employers, it requires rigorous financial planning and strategic reassessment of which roles warrant sponsorship investment. For skilled migrants, it underscores the importance of developing contingency pathways and building exceptional professional credentials that make sponsorship an attractive business investment.

The 4.6% increase reflects a government commitment to maintaining fair wages for sponsored workers while protecting Australian labor market integrity. As Australia continues to rely on skilled migration to address workforce shortages and support economic growth, these thresholds will remain central to visa strategy and planning. Staying informed about these changes and proactively adjusting your sponsorship or migration strategy ensures you're well-positioned to navigate Australia's skilled migration landscape effectively.

Whether you're an employer investing in sponsorship or a skilled worker pursuing migration, now is the time to revisit your planning, recalculate your economics, and confirm that your pathway remains optimal under the new threshold environmentvironment.

If you’re an employer planning to sponsor skilled workers, or a migrant aiming to secure your Australian future, don’t leave your pathway to chance. Our experienced migration specialists are here to help you break down the latest rules, prepare compliant applications, and create a tailored strategy that gets results—despite policy changes.

Contact Think Visa today for a confidential consultation and make your next move with confidence!