Australian Income Tax Calculator
Use our free Australian income tax calculator to estimate your tax for the 2026-27 financial year, with FY 2025-26 and FY 2024-25 also available for the returns people are still lodging. Calculates income tax, Medicare levy, Medicare levy surcharge, Low Income Tax Offset (LITO), and HELP/HECS repayments. The rate on income between $18,201 and $45,000 fell from 16% to 15% on 1 July 2026, which is worth up to $268 a year.
Your details
FY 2026-27Work-related expenses, donations, etc.
Lodging your 2025-26 return? Pick FY 2025-26.
- Take-Home Pay
- $0
- $0 per fortnight
- Total Tax
- $0
- Effective rate: 0.0%
- Weekly
- $0
- Fortnightly
- $0
- Monthly
- $0
- Marginal Rate
- 0.0%
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Australian Income Tax Rates 2026-27
The rate on the second bracket fell from 16% to 15% on 1 July 2026, under the personal tax cuts legislated in March 2025. Bracket thresholds did not move, so the whole saving sits in the $18,201 to $45,000 band: tax on that band drops from $4,288 to $4,020, worth up to $268 a year to anyone earning above $45,000. The same legislation takes the rate to 14% on 1 July 2027.
FY 2026-27 tax brackets for Australian residents (current)
| Taxable Income | Tax Rate |
|---|---|
| $0 to $18,200 | Nil |
| $18,201 to $45,000 | 15c for each $1 over $18,200 |
| $45,001 to $135,000 | $4,020 + 30c for each $1 over $45,000 |
| $135,001 to $190,000 | $31,020 + 37c for each $1 over $135,000 |
| $190,001+ | $51,370 + 45c for each $1 over $190,000 |
FY 2025-26 tax brackets, the year most people are lodging now
The 2025-26 year closed on 30 June 2026, so this is the table that applies to the return you are lodging this spring. Pick FY 2025-26 in the financial year list above to calculate on it. The Stage 3 cuts that took effect on 1 July 2024 shaped this table: the 19% rate became 16%, the 32.5% rate became 30%, and the 37% bracket started at $135,000 instead of $120,000.
| Taxable Income | Tax Rate |
|---|---|
| $0 to $18,200 | Nil |
| $18,201 to $45,000 | 16c for each $1 over $18,200 |
| $45,001 to $135,000 | $4,288 + 30c for each $1 over $45,000 |
| $135,001 to $190,000 | $31,288 + 37c for each $1 over $135,000 |
| $190,001+ | $51,638 + 45c for each $1 over $190,000 |
How to calculate income tax in Australia
The plain-text formula is:
Total tax = (income tax on taxable income − LITO) + (2% × taxable income) + Medicare Levy Surcharge (if any) + HELP/HECS repayment (if any), and take-home pay = gross income − total tax.
Taxable income is your gross annual income minus allowable deductions. Income tax on that figure is read straight from the resident brackets above (each bracket adds a fixed base amount plus the marginal rate on the dollars within it).
Worked example: income tax on $85,000
For a resident earning $85,000 in FY 2026-27 with no deductions:
- $85,000 sits in the 30% bracket, so income tax = $4,020 + 30c for each $1 over $45,000 = $4,020 + (30% × $40,000) = $16,020.
- LITO does not apply because the income is above the $66,667 cut-off, so the offset is $0.
- Medicare levy = 2% × $85,000 = $1,700.
- Total tax = $16,020 + $1,700 = $17,720, leaving take-home pay of $85,000 − $17,720 = $67,280 for the year.
- The same income in FY 2025-26 attracted $16,288 of income tax, so switching the year in the calculator shows the $268 the 1 July 2026 cut is worth.
How this calculator works
Enter your gross annual income and we calculate your income tax using the official ATO marginal rates. We then apply the Low Income Tax Offset (LITO) for eligible residents, add the 2% Medicare levy, check for Medicare Levy Surcharge if you don't have private health insurance, and include any HELP/HECS-HELP compulsory repayment. The result is your estimated take-home pay after all deductions.
To check the tax your employer should withhold each pay cycle, use the PAYG withholding calculator, or start from your full package with the salary and take-home pay calculator. Sole traders can estimate tax on business profit with the sole trader tax calculator, and if you expect money back the tax refund calculator compares tax payable against what was withheld. When it is time to lodge, see the ATO tax lodgement app.
Frequently asked questions
What are the Australian tax rates for 2026-27?
For FY 2026-27, Australian residents pay: 0% on $0-$18,200, 15% on $18,201-$45,000, 30% on $45,001-$135,000, 37% on $135,001-$190,000, and 45% on income over $190,000. The second bracket fell from 16% to 15% on 1 July 2026 under the personal tax cuts legislated in March 2025. Thresholds are unchanged.
What were the tax rates for 2025-26?
For FY 2025-26, Australian residents paid: 0% on $0-$18,200, 16% on $18,201-$45,000, 30% on $45,001-$135,000, 37% on $135,001-$190,000, and 45% on income over $190,000. That is the year you are lodging a return for if you are doing your 2026 return now, so pick FY 2025-26 in the financial year list above. The calculator also covers FY 2024-25 for late and amended returns.
What is the tax-free threshold in Australia?
The tax-free threshold for Australian residents is $18,200. With the Low Income Tax Offset (LITO), the effective tax-free threshold is approximately $22,575. Foreign residents and working holiday makers do not receive the tax-free threshold.
Is the Medicare levy included in the tax figure above?
Yes. The take-home figure subtracts income tax, the 2% Medicare levy and, where it applies, the Medicare Levy Surcharge, so the effective rate shown is all of them together rather than the income tax alone. The surcharge is the one worth checking: it adds 1% to 1.5% of your income if you earn above $105,000 as a single in FY 2026-27 (up from $101,000 in FY 2025-26) and hold no private hospital cover, and switching the private health toggle above shows what it is costing you. Low-income earners can have the 2% levy reduced or removed entirely, which this calculator applies from the ATO thresholds.
What is LITO?
The Low Income Tax Offset (LITO) is a tax offset of up to $700 for individuals earning $37,500 or less. It phases out between $37,501 and $66,667. LITO reduces the amount of tax you pay but cannot create a refund.
How are HELP/HECS repayments calculated?
HECS-HELP repayments are based on your repayment income, which includes taxable income plus any reportable fringe benefits, net investment losses, and exempt foreign employment income. The repayment rate ranges from 1% to 10% depending on your income level.
How do I calculate income tax on $85,000 in Australia?
On $85,000 of taxable income (FY 2026-27, resident, no deductions): you fall in the 30% bracket, so income tax is $4,020 plus 30c for each $1 over $45,000 = $4,020 + ($40,000 × 30%) = $16,020. Add the 2% Medicare levy ($1,700) for total tax of about $17,720, leaving roughly $67,280 take-home pay. LITO does not apply because the income is above $66,667. The same income in FY 2025-26 attracted $16,288 of income tax, so the 1 July 2026 rate cut is worth $268.
How do sole traders calculate their tax in Australia?
A sole trader's net business profit (income minus deductible business expenses) is added to any other personal income and taxed at the same individual marginal rates shown here, there is no separate sole-trader tax rate. The 2% Medicare levy and any HELP/HECS repayment also apply. Use your expected net profit as the income figure above to estimate your bill.
What changed with the Stage 3 tax cuts?
From 1 July 2024, the 19% rate was reduced to 16%, the 32.5% rate was reduced to 30%, and the $120,000 threshold was raised to $135,000. Every Australian earning over $18,200 received a tax cut, with the maximum benefit of $4,529 for incomes of $190,000 and above. A separate cut, legislated in March 2025, took the 16% rate to 15% on 1 July 2026 and takes it to 14% on 1 July 2027.
Sources & methodology
How we calculate this
This calculator applies the ATO individual income tax marginal rates for the financial year you select (FY 2026-27 by default, with FY 2025-26 and FY 2024-25 for returns you are still lodging) to your taxable income, then layers on the Low Income Tax Offset, the 2% Medicare levy, any Medicare Levy Surcharge, and compulsory HELP/HECS-HELP repayments. Everything is computed in your browser, nothing you enter is stored or sent to a server.
Authoritative sources
Reviewed by Bishal Shrestha, Founder of OneBookPlus, 10+ years building tools with Australian tax-agent and BAS-agent practices. Rates and thresholds last verified: .
Disclaimer: This calculator produces estimates only and is not tax advice. Tax outcomes depend on your individual circumstances. For decisions that affect your tax position, consult a registered tax agent or the ATO directly.
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