Tax Calculator Australia

How this tax calculator works

Australia uses a progressive tax system: your income is taxed in slices (brackets), and each slice is taxed at a different rate. You don't pay the top rate on your whole income, only on the portion that falls inside each bracket. This calculator applies the ATO's current 2025-26 resident or foreign resident brackets to your taxable income, adds the 2% Medicare Levy (for residents), and shows your total tax and take-home pay.

"Taxable income" means your income after allowable deductions, not your gross salary before any deductions. If you're not sure of the difference, use your gross salary as a starting estimate; this calculator (like the ATO's own simple tax calculator) treats the number you enter as taxable income.

Every figure is recalculated live as you type or switch residency status, and the bracket-by-bracket table below the result updates to match, so you can see exactly which slice of your income is taxed at which rate, instead of just a single final number.

1. Enter your taxable income for the year in the field above.
2. Choose whether you're an Australian resident or a foreign resident for tax purposes.
3. See your income tax, Medicare Levy (if applicable), total tax and take-home pay update instantly.
4. Check the bracket-by-bracket breakdown table to see exactly how each slice of your income is taxed.

2025-26 Australian resident tax brackets

These are the current ATO resident tax brackets for the 2025-26 income year (1 July 2025 to 30 June 2026). They are unchanged from 2024-25, after the Stage 3 tax cuts already took effect on 1 July 2024.

These rates don't include the Medicare Levy (2%), which is added separately below. See the full 2025-26 tax brackets page for the foreign resident table too, and note that the 16% bracket is scheduled to drop to 15% from 1 July 2026.

The Medicare Levy, explained

Most Australian residents pay an additional 2% Medicare Levy on top of their income tax, which helps fund Australia's public healthcare system. It isn't part of the tax brackets above; it's calculated separately, on your whole taxable income.

If your income is low, you may pay a reduced levy or none at all. For 2025-26, singles with taxable income under $28,011 pay no Medicare Levy; between $28,011 and $35,013 the levy phases in gradually at 10 cents per dollar over the lower threshold; above $35,013 the full 2% applies to your entire income. Use the dedicated Medicare Levy calculator to see this breakdown for your own income. Foreign residents don't pay the Medicare Levy at all.

This calculator doesn't include the separate Medicare Levy Surcharge (MLS), which only applies to higher-income earners without private hospital cover; that's a distinct calculation tied to your private health insurance status and family income, not something a taxable-income-only calculator can determine reliably.

Resident vs. foreign resident for tax purposes

Your residency status for tax purposes isn't the same as your visa or citizenship status; it depends on where you actually live and your ties to Australia, and the ATO applies its own residency tests (including the resides test, the domicile test, the 183-day test and the Commonwealth superannuation test). The two statuses are taxed very differently:

• Australian residents get the tax-free threshold ($18,200) and pay the Medicare Levy, but are taxed on income from all sources, worldwide.
• Foreign residents pay tax from the very first dollar of Australian-sourced income (no tax-free threshold), starting at 30%, but don't pay the Medicare Levy.
• Above $135,000, resident and foreign resident marginal rates converge (37%, then 45%); the difference is concentrated in the lower brackets, where the missing tax-free threshold and higher starting rate hit foreign residents hardest.
• If your residency status changes partway through the year (for example, you arrive in or leave Australia), the ATO applies a part-year tax-free threshold calculation that this simplified calculator does not model; consult the ATO or a registered tax agent for that scenario.

Worked examples

Example 1: $65,000, Australian resident. Tax-free on the first $18,200. The next $26,800 (up to $45,000) is taxed at 16% = $4,288. The remaining $20,000 (up to $65,000) is taxed at 30% = $6,000. Income tax = $10,288. Medicare Levy (2% of $65,000) = $1,300. Total tax = $11,588. Take-home pay = $53,412.

Example 2: $150,000, Australian resident. Income tax works out to $31,288 (cumulative tax to $135,000) plus 37% of the remaining $15,000 ($5,550) = $36,838. Medicare Levy (2% of $150,000) = $3,000. Total tax = $39,838. Take-home pay = $110,162.

Example 3: $80,000, foreign resident. No tax-free threshold: the whole $80,000 is taxed at the flat 30% foreign resident rate = $24,000. No Medicare Levy applies. Take-home pay = $56,000, noticeably less than a resident on the same income, because of the missing tax-free threshold.

Example 4: $25,000, Australian resident. Tax-free on the first $18,200. The remaining $6,800 is taxed at 16% = $1,088. Because $25,000 falls in the Medicare Levy low-income reduction zone ($28,011 is the exemption threshold), no Medicare Levy applies at all. Total tax = $1,088. Take-home pay = $23,912.

Try these figures in the calculator above to see the full bracket-by-bracket breakdown for each case, including exactly how much of each bracket's rate applies to your own income.

Common misconceptions about tax brackets

A very common misunderstanding is thinking that moving into a higher tax bracket means all of your income suddenly gets taxed at the higher rate. That isn't how Australia's progressive system works: only the portion of your income that falls inside a given bracket is taxed at that bracket's rate. Earning one extra dollar that pushes you from the 30% bracket into the 37% bracket only costs you an extra 37 cents on that one dollar; not 37% of your entire income.

Another common mix-up is confusing your marginal tax rate (the rate on your next dollar earned) with your effective tax rate (your total tax divided by your total income). The effective rate is always lower than the marginal rate for anyone earning above the tax-free threshold, because the earlier, lower-taxed slices of income pull the average down. This calculator shows both concepts: the bracket table shows your marginal rates in action, and the "Effective tax rate" figure in the result summary shows your actual overall rate.

When and how tax is actually paid in Australia

Most Australian employees don't pay their income tax as a lump sum. Instead, their employer withholds an estimated amount from every pay, called PAYG (Pay As You Go) withholding, based on ATO withholding schedules that already approximate the brackets shown on this page. At the end of the financial year (30 June), you lodge a tax return, and the ATO reconciles what was actually withheld against what you actually owed based on your final taxable income, deductions and offsets, resulting in either a refund or a bill for the difference.

This calculator estimates that final "what you actually owe" figure directly from your taxable income, which is useful for checking a payslip, comparing job offers, or estimating a return before you lodge, but it isn't a substitute for the PAYG withholding tables your employer uses pay-to-pay, and it doesn't replace lodging an actual tax return through the ATO or a registered tax agent.

The financial year in Australia runs from 1 July to 30 June, which is why tax brackets are labelled by the pair of years they span ("2025-26" means 1 July 2025 to 30 June 2026) rather than by a single calendar year.

What this calculator doesn't include

To keep the numbers transparent and easy to verify against the ATO's own published tables, this calculator deliberately does not include: the Medicare Levy Surcharge (depends on private health insurance and a separate income test), HECS-HELP student loan repayments, superannuation contributions, tax offsets like the Low Income Tax Offset, or any deductions; it works from the taxable income figure you enter, the same starting point the ATO's own simple tax calculator uses. For a full, personalised assessment that accounts for all of these, use the ATO's own tools or speak with a registered tax agent. See the privacy page for details on how your figures are (and aren't) handled.