Australian Income Tax Calculator (2026-27)

How Australian income tax works

Australia runs a progressive marginal tax system. Your income is sliced into bands, and each band is taxed at its own rate. You never get pushed into "a higher bracket" on your whole income — only the dollars that fall inside that bracket are taxed at the higher rate. Everything below it keeps the lower rates.

For most employees, your employer takes tax out of each pay packet using the ATO's PAYG withholding schedules and forwards it to the ATO. When you lodge your tax return at the end of the financial year (1 July to 30 June), the ATO works out what you actually owe based on your real income, deductions and offsets, and refunds or bills the difference.

Your final tax bill is built from three main moving parts: income tax on your taxable income, the Medicare levy on top of that, and any offsets (like LITO) that reduce what you owe. If you have a HECS-HELP debt, a compulsory repayment is added on top.

The 2026-27 tax brackets (Stage 3)

The Stage 3 cuts took effect on 1 July 2024, and from 1 July 2026 the 16% rate dropped again to 15%. These are the official ATO resident brackets used for the entire 2026-27 financial year:

Source: ATO, individual income tax rates for residents, 2026-27. Excludes Medicare levy.

If you only earn under $18,200 you pay no income tax at all (you may still need to lodge a return). The Stage 3 change dropped the second marginal rate from 19% to 16% and reshaped the middle brackets so most workers earning between $45,000 and $135,000 keep more of each extra dollar.

Medicare levy

The Medicare levy is an extra 2% of your taxable income, separate from income tax. It funds Australia's public healthcare system. For 2026-27:

• If your taxable income is below $28,011 (single, no dependants), you pay no levy.
• Between $28,011 and $35,013, the levy phases in at 10 cents in the dollar.
• Above $35,013 the full 2% applies on your whole taxable income.

Higher-income earners without private hospital cover may also pay the Medicare Levy Surcharge (an extra 1% to 1.5%). That's not included in the calculator above, but if your income is above $105,000 single or $210,000 family, it's worth checking with the ATO whether private hospital cover would save you money.

Low Income Tax Offset (LITO)

LITO is a non-refundable tax offset for lower-income workers. For 2026-27 the maximum is $700 and it phases out as your income grows:

• Full $700 if your taxable income is $37,500 or less.
• Phases out at 5 cents per dollar from $37,500 to $45,000 (down to $325).
• Phases out at 1.5 cents per dollar from $45,000 to $66,667 (down to zero).

LITO is automatically applied when you lodge your tax return — you don't claim it separately. Because it's non-refundable, it can only reduce tax payable to zero. If your tax bill is already nil, LITO doesn't pay you cash.

HECS-HELP repayments

If you have a HECS-HELP debt, you have to make a compulsory repayment once your repayment income hits the ATO's threshold. Under the marginal system (introduced 2025-26), repayments start above $69,528 for 2026-27 and apply only to the income over each threshold (15c, then 17c per $1), reaching a flat 10% of total income above $186,050.

Repayment income includes your taxable income plus reportable fringe benefits and reportable super contributions — so unlike many other deductions, salary sacrificing into super won't reduce your HECS repayment. For a full breakdown by income band, see our HECS-HELP calculator.

Working out your take-home pay (worked example)

Let's run a $90,000 salary through the brackets to see exactly how the maths works:

• First $18,200 — taxed at 0% — tax: $0.
• Next $26,800 (up to $45,000) — taxed at 15% — tax: $4,020.
• Next $45,000 (from $45,001 to $90,000) — taxed at 30% — tax: $13,500.
• Income tax subtotal: $17,520.
• Medicare levy: 2% of $90,000 = $1,800.
• LITO: zero (income is above the $66,667 cut-off).
• Total tax: $19,320.
• Take-home pay: $70,680 per year, or about $2,718 per fortnight.

Your marginal rate at $90,000 is 30% income tax + 2% Medicare = 32%. Your effective rate (total tax divided by gross income) is about 21.5% — significantly lower, which is exactly how a progressive system is supposed to work.

Examples by salary

Quick-reference table for common Australian salaries (2026-27, resident, no HECS, full Medicare levy where applicable, LITO included):

Single Australian resident for tax purposes, no dependants, no HECS-HELP debt, salary quoted excluding super. Calculated using 2026-27 ATO brackets, the 2% Medicare levy and LITO. Excludes HECS, MLS and private offsets. Figures are rounded to the nearest dollar, the same way the calculator rounds — the only row where rounding hides anything is $30,000, where the Medicare levy is $198.90 exactly.

Show your working — two rows in full

$60,000 — the row where LITO is still partly alive.

• Income tax: $60,000 sits in the third bracket (over $45,000, up to $135,000), so tax = base $4,020 + 30% × ($60,000 − $45,000) = $4,020 + $4,500 = $8,520.
• LITO: $60,000 is above $45,000 and below the $66,667 cut-out, so the second taper applies: $325 − 1.5% × ($60,000 − $45,000) = $325 − $225 = $100.
• Tax after LITO: $8,520 − $100 = $8,420.
• Medicare levy: $60,000 is above the $35,013 upper threshold, so the full 2% applies to the whole taxable income: 2% × $60,000 = $1,200.
• Take-home: $60,000 − $8,420 − $1,200 = $50,380.
• Effective rate: $9,620 ÷ $60,000 = 16.03%.

$200,000 — the row in the top bracket.

• Income tax: base $51,370 + 45% × ($200,000 − $190,000) = $51,370 + $4,500 = $55,870.
• LITO: nil, well past the $66,667 cut-out.
• Medicare levy: 2% × $200,000 = $4,000.
• Take-home: $200,000 − $55,870 − $4,000 = $140,130.

If the salary figure includes super

Tick “my salary includes super” and the calculator backs the 12% super guarantee out of the package before taxing anything.

Base salary = package ÷ 1.12. It is not package × 0.88 — that is the most common mistake people make with a package figure, and it gives a different, wrong answer.

If you have a HECS-HELP debt

Pay period equivalents

Converting an annual figure into weekly, fortnightly or monthly is straightforward, but Australian payroll uses some standard divisors:

• Weekly: annual ÷ 52. (Some payrolls use 52.143 to account for the extra day each year.)
• Fortnightly: annual ÷ 26. The ATO's official fortnightly tax tables use this divisor.
• Monthly: annual ÷ 12.

So on $90,000 gross, your fortnightly gross is $3,461 and your fortnightly take-home (after $19,320 annual tax) is about $2,718. Use our pay period converter for any annual figure, or just switch the period selector in the calculator above.

A small mismatch between this calculator and your actual payslip is normal. Employers withhold using the ATO's PAYG schedules, which round to the nearest dollar and use slightly different fortnightly maths to smooth the year. Over a full financial year, the totals reconcile.

When to use this calculator vs a payslip

Use this calculator for annual planning: comparing job offers, modelling a pay rise, working out year-to-date (YTD) expectations, or stress-testing a budget. It gives you a clean, full-year estimate built on the official brackets.

Use your payslip for the actual per-pay-period figures. Payroll software uses the ATO's withholding schedules, which can differ by a few dollars per pay because of rounding and how they handle leave loading, bonuses and allowances. Your annual tax return is the source of truth — that's when the ATO reconciles withholding to your real liability.

For super-related planning — including reducing your taxable income through pre-tax contributions — pair this with our salary sacrifice calculator and super calculator.

Methodology

What this calculator computes: take-home pay for an Australian resident for tax purposes, for a full financial year, using the rates in force in that year.

taxable income  = salary  (or package ÷ 1.12 if the salary includes super)
income tax      = progressive bracket table
tax after LITO  = max(0, income tax − LITO)
Medicare levy   = shading-in / 2% rule
HECS-HELP       = marginal repayment on repayment income, if a debt is flagged
take-home pay   = taxable income − tax after LITO − Medicare levy − HECS-HELP

Low Income Tax Offset. An offset, not a deduction: it reduces the tax bill after it has been worked out, and it cannot take that bill below zero.

taxable ≤ $37,500             → $700
$37,500 < taxable ≤ $45,000   → $700 − 5% × (taxable − $37,500)
$45,000 < taxable ≤ $66,667   → $325 − 1.5% × (taxable − $45,000)
taxable > $66,667              → nil

Medicare levy. This is the single, no-dependants rule. Family thresholds, seniors and pensioners thresholds, and levy exemptions are not modelled.

taxable ≤ $28,011             → nil
$28,011 < taxable < $35,013    → 10c per $1 above $28,011  (the shading-in range)
taxable ≥ $35,013             → 2% of the whole taxable income

HECS-HELP. From 2026-27 repayments are marginal, not a flat percentage of everything:

repayment income ≤ $69,528   → nil
≤ $129,717                   → 15c per $1 over $69,528
≤ $186,050                   → $9,028 plus 17c per $1 over $129,717
above $186,050                 → 10% of the whole repayment income

Assumptions, stated plainly.

• A full financial year on the one salary. Starting or leaving a job part-way through a year is not handled.
• No deductions, no other income, no capital gains, no offsets other than LITO.
• Resident for tax purposes, claiming the tax-free threshold from this employer.
• No dependants, no spouse income, no Medicare levy exemption or reduction beyond the single low-income shading-in rule.
• No Medicare levy surcharge — that has its own page.
• Super guarantee at 12%, used only to back super out of a package figure.
• It is an estimate, not a tax return, and not personal advice.

Frequently asked questions

Official ATO references

• Individual income tax rates for residents — ATO
• Medicare levy — ATO
• Low Income Tax Offset — ATO
• HECS-HELP compulsory repayments — ATO

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