Work out your Australian income tax for 2025-26 or 2026-27 — tax payable, Medicare levy, and take-home pay computed with ATO resident tax rates.
2026–27 ATO tax rates · includes the 1 July 2026 cut
A plain-English read of where every dollar of the salary lands — using ATO 2026–27 rates and current Medicare, MLS and HECS / HELP settings.
The ATO applies marginal rates: each portion of taxable income is taxed at the rate of the bracket it falls into. Thresholds last shifted on 1 July 2024 with the Stage 3 tax cuts. The colour swatches map to the bracket-fill chart in the result panel.
| Bracket | Rate | Annual Portion | Tax on Full Bracket | Cumulative Tax |
|---|---|---|---|---|
| AUD 0 – 18,200 | 0% | AUD 18,200 | AUD 0 | AUD 0 |
| AUD 18,201 – 45,000 | 15% | AUD 26,800 | AUD 4,020 | AUD 4,020 |
| AUD 45,001 – 135,000You | 30% | AUD 45,000 | AUD 27,000 | AUD 17,520 |
| AUD 135,001 – 190,000 | 37% | — | AUD 20,350 | — |
| AUD 190,001+ | 45% | — | — | — |
Marginal rate is what is paid on the next dollar earned. Effective rate is what is paid on average across all dollars. The effective rate is always lower than (or equal to) the marginal rate.
In the 30% bracket. The next dollar earned is taxed at this rate, not the whole salary.
Income tax + Medicare on gross. Total deductions are 21.5% of gross (AUD 19,320 on AUD 90,000).
How this gross income compares to the Australian taxpayer distribution. Filterable by gender and age group. Source: ATO Taxation Statistics 2022–23.
For every AUD 100 of income tax + Medicare collected, here's roughly how the Federal Government spends it — based on Treasury's Budget 2025–26 Federal expenditure breakdown. Bars show the annual contribution to each function from AUD 19,320 in tax.
ATO-confirmed rates for the 2025–26 financial year (1 July 2025 – 30 June 2026). All figures sourced from official government data.
New marginal repayment system from 1 July 2025. Threshold lifted to AUD 67,000. A 20% reduction was applied to all HELP debts in June 2025.
Additional surcharge for higher-income earners without appropriate private hospital cover. 2025–26 thresholds (singles).
Super Guarantee reached its final scheduled rate of 12% on 1 July 2025. Payday Super applies from 1 July 2026.
Low-income earners may be exempt from or pay a reduced Medicare Levy. The standard rate is 2% of taxable income. Figures below are the latest ATO-published thresholds (labelled 2024–25 on ato.gov.au; the ATO has not yet published 2025–26 thresholds — these are typically legislated retrospectively).
| Category | No Levy Below | Reduced Levy Up To |
|---|---|---|
| Singles | AUD 27,222 | AUD 34,027 |
| Families (base) | AUD 45,907 | AUD 57,383 |
| Seniors / pensioners — single | AUD 43,020 | AUD 53,775 |
| Seniors / pensioners — family | AUD 59,886 | AUD 74,857 |
Family lower thresholds increase by AUD 4,216 and upper thresholds by AUD 5,270 for each dependent child. Source: ATO Medicare Levy reduction.
The LITO reduces tax payable for lower- and middle-income earners. It is applied automatically by the ATO when a return is lodged.
| Taxable Income | LITO Amount |
|---|---|
| Up to AUD 37,500 | Full offset of AUD 700 |
| AUD 37,501 – 45,000 | AUD 700 minus 5¢ per $1 over AUD 37,500 |
| AUD 45,001 – 66,667 | AUD 325 minus 1.5¢ per $1 over AUD 45,000 |
| Above AUD 66,667 | No offset |
SAPTO provides additional tax relief for eligible seniors at Age Pension age (67+).
| Status | Maximum Offset | Cutout Income |
|---|---|---|
| Single | AUD 2,230 | AUD 52,759 |
| Couple (each) | AUD 1,602 | AUD 43,810 |
No tax-free threshold applies.
| Income | Rate |
|---|---|
| AUD 0 – 135,000 | 30% |
| AUD 135,001 – 190,000 | 37% |
| AUD 190,001+ | 45% |
Subclass 417 and 462 visa holders.
| Income | Rate |
|---|---|
| AUD 0 – 45,000 | 15% |
| AUD 45,001 – 135,000 | 30% |
| AUD 135,001 – 190,000 | 37% |
| AUD 190,001+ | 45% |
Common expense categories with relaxed substantiation requirements per the ATO.
Recent tax legislation, ATO compliance updates, and policy changes affecting Australian taxpayers — sourced from official government channels.
The Australian Taxation Office identified work-related deductions and omitted income as its two primary focus areas for 2026.
The ATO issued a public warning about inaccurate tax information from AI platforms and social media finfluencers.
Taxpayers remain accountable for the accuracy of their returns regardless of where the source information originated. The ATO recommends consulting a registered tax agent or refer to ato.gov.au for verified guidance.
The ATO launched an in-app security feature on 2 April 2026 to help taxpayers detect and block scam calls impersonating tax officials.
The tool reflects ongoing investment in fraud prevention as scammers continue to target tax-time periods. Available through the ATO app on the App Store and Google Play.
Common questions about Australian income tax, the Medicare Levy, HECS / HELP, deductions, and superannuation — answers verified against official ATO guidance.
Yes. Australian tax residents do not pay income tax on the first AUD 18,200 of taxable income. The threshold applies for the full financial year (1 July to 30 June) and reduces proportionally if residency starts mid-year.
Non-residents and working holiday makers do not receive the tax-free threshold.
ATO Tax RatesAustralia uses a progressive tax system. Different portions of taxable income are taxed at different rates, with higher portions taxed at higher rates.
For 2025–26, resident rates are 0% on the first AUD 18,200, 16% on AUD 18,201–45,000, 30% on AUD 45,001–135,000, 37% on AUD 135,001–190,000, and 45% above AUD 190,000.
The 2% Medicare Levy is calculated separately on top of these rates.
ATO Tax RatesThe marginal tax rate is the rate paid on the next dollar earned — the rate of the highest bracket the income reaches.
The effective tax rate is the average tax paid across all earnings, calculated as total tax divided by total income. It is always lower than the marginal rate due to the progressive system.
Example: AUD 90,000 income for 2025–26 has a marginal rate of 30% but an effective tax rate of approximately 21.8% including the Medicare Levy.
ATO Tax RatesThe Australian financial year runs from 1 July to 30 June. The 2025–26 financial year started on 1 July 2025 and ends on 30 June 2026.
Self-lodged tax returns are due by 31 October following the end of the financial year. Returns lodged through a registered tax agent typically have an extended deadline of 15 May the following year, provided the agent registration is in place by 31 October.
ATO Lodging Your ReturnThe ATO uses several tests to determine tax residency, including the resides test, domicile test, 183-day test, and Commonwealth superannuation test. Tax residency is not the same as visa status or citizenship.
Australian tax residents are taxed on worldwide income and receive the tax-free threshold. Non-residents are taxed only on Australian-sourced income at higher rates and do not receive the tax-free threshold.
ATO Tax ResidencyWork-related expenses must satisfy the ATO's three rules: the expense must relate to earning income, the taxpayer must have paid it personally without reimbursement, and substantiation (such as a receipt or invoice) must be retained.
Common deductible categories include work-related clothing, tools, professional memberships, work-from-home expenses, self-education directly related to current employment, vehicle expenses for work travel (excluding home-to-work commute), and tax agent fees.
ATO DeductionsTwo methods are available for the 2025–26 income year:
The fixed-rate method does not allow separate claims for the items it covers, but depreciation of office furniture and equipment can be claimed in addition.
ATO WFH ExpensesTwo methods apply for 2025–26:
Travel between home and a regular workplace generally cannot be claimed.
ATO Transport & TravelDonations of AUD 2 or more to a Deductible Gift Recipient (DGR) are tax deductible. The recipient organisation must hold DGR endorsement at the time of the gift. Receipts should state the DGR's name, ABN, the donation amount, and confirm the contribution is a gift.
Donations made in exchange for goods, services, raffle tickets, or where a benefit is received are generally not deductible.
ATO Gifts & DonationsSelf-education expenses are deductible if the course has a sufficient connection to current employment activities or is likely to lead to an income increase from current work. Eligible costs include course fees, textbooks, stationery, and travel directly related to the study.
Courses that lead to a new field of employment are not deductible, even if the new role would generate higher income.
ATO Self-EducationThe Medicare Levy is 2% of taxable income and helps fund Australia's public health system. Most Australian tax residents pay it.
Low-income earners may pay a reduced rate or be exempt. Per the latest ATO-published thresholds (labelled 2024–25 on ato.gov.au; 2025–26 thresholds not yet published), singles with taxable income below AUD 27,222 pay no levy; the levy phases in between AUD 27,222 and AUD 34,027. Family thresholds are AUD 45,907 / 57,383, with AUD 5,270 added per dependent child.
ATO Medicare LevyThe MLS is an additional tax of 1% to 1.5% applied to higher-income earners who do not hold appropriate private hospital cover for the full income year. It is in addition to the standard 2% Medicare Levy.
For 2025–26, single thresholds are AUD 101,001 (1%), AUD 118,001 (1.25%), and AUD 158,001 (1.5%). Family thresholds are AUD 202,001 (1%), AUD 236,001 (1.25%), and AUD 316,001 (1.5%), increased by AUD 1,500 per dependent child after the first.
ATO MLSFrom 1 July 2025, HECS / HELP repayments use a marginal repayment system. The compulsory repayment threshold is AUD 67,000.
A 20% reduction was applied to all outstanding HELP debts in June 2025 before indexation.
ATO HELP ThresholdsLITO reduces the income tax payable for lower-income earners. For 2025–26:
LITO is applied automatically by the ATO when a tax return is lodged. It cannot reduce the Medicare Levy.
ATO LITOThe Seniors and Pensioners Tax Offset (SAPTO) provides additional tax relief for eligible seniors at Age Pension age (currently 67).
Maximum offsets for 2025–26:
Eligibility requires meeting age, residency, and rebate income tests. SAPTO recipients also benefit from higher Medicare Levy thresholds.
ATO SAPTOYes. Non-residents do not receive the tax-free threshold, do not pay the Medicare Levy, and are taxed at higher marginal rates from the first dollar:
Working Holiday Makers (subclass 417 and 462 visa holders) have a separate scale: 15% on the first AUD 45,000, then resident rates above that threshold.
ATO Foreign Resident RatesFor taxpayers lodging directly through myTax or paper, the deadline is 31 October following the end of the financial year. The 2025–26 return must be lodged by 31 October 2026.
Taxpayers using a registered tax agent typically have an extended deadline up to 15 May 2027, provided the tax agent is engaged before 31 October 2026.
Late lodgement may result in a Failure to Lodge (FTL) penalty.
ATO Lodging Your ReturnThe Super Guarantee rate for 2025–26 is 12% of ordinary time earnings (OTE). This is the final scheduled rate under current legislation.
The maximum quarterly earnings base for 2025–26 is AUD 62,500 (equivalent to AUD 250,000 per year). Employers are not required to pay SG on earnings above this cap per employee.
From 1 July 2026, Payday Super applies — employers must pay SG at the same time as wages instead of quarterly.
ATO Super GuaranteeFor 2025–26:
Contributions exceeding the caps are subject to additional tax at marginal rates.
ATO Contribution CapsRecords supporting income, deductions, and offset claims must generally be retained for 5 years from the date of lodgement of the relevant tax return.
Required records include payment summaries (or ATO income statements), receipts and invoices for deductions, a logbook for vehicle expenses (when using the logbook method), a record of work-from-home hours (for the fixed-rate method), and bank statements for investment income.
Records can be paper or electronic, provided they remain legible.
ATO Record KeepingThree options are available:
An ATO online services account requires a myGov account linked to the ATO.
ATO How to LodgeLate lodgement may attract a Failure to Lodge (FTL) penalty of one penalty unit (currently AUD 330, effective 7 November 2024) for every 28-day period the return is overdue, up to a maximum of five penalty units.
If a refund is owed, no FTL penalty typically applies, but interest on any unpaid debt may still accrue. The ATO may also issue default assessments based on third-party information if returns are not lodged.
ATO Late LodgementFor educational and informational purposes only. This calculator produces estimates based on the inputs provided and the ATO 2025–26 tax brackets, including the Stage 3 tax cuts effective from 1 July 2024. Medicare Levy is calculated at 2% with low-income thresholds applied. Medicare Levy Surcharge thresholds are AUD 101,000 (singles) and AUD 202,000 (families) for 2025–26. HECS / HELP repayments use the marginal repayment system effective 1 July 2025 with a threshold of AUD 67,000. Super Guarantee is 12% (final scheduled rate), and the concessional contribution cap is AUD 30,000. Family Tax Benefit estimates use Services Australia 2025–26 thresholds and may differ from formal entitlement assessments.
No warranty of accuracy. While Money Snap takes reasonable care to source figures from official authorities (ATO, ASIC MoneySmart, Services Australia), this calculator is provided "as is" without any express or implied warranty as to accuracy, completeness, timeliness, or fitness for any particular purpose. Rates, thresholds, and policies change frequently — figures shown may be out of date, and individual circumstances, deductions, offsets, residency, and income types not captured by the inputs may materially affect actual tax obligations.
Not financial advice. Information provided is general in nature only and does not take into account your personal objectives, financial situation, or needs. Results do not constitute financial, tax, or legal advice and use of this calculator does not create an advisory relationship. Before acting on any figure shown, obtain personal advice from a registered tax agent (Tax Practitioners Board), a licensed financial adviser, or seek formal computation directly from the ATO.
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