Income tax, 2026-27
Australian tax rates 2026-27
The resident tax brackets for the income year 1 July 2026 to 30 June 2027, what changed, the new $1,000 standard deduction, the low income tax offset and the other amounts that come out of your pay.
Resident tax brackets for 2026-27
| Taxable income | Tax on this income |
|---|---|
| $0 to $18,200 | Nil |
| $18,201 to $45,000 | 15c for each $1 over $18,200 |
| $45,001 to $135,000 | $4,020 plus 30c for each $1 over $45,000 |
| $135,001 to $190,000 | $31,020 plus 37c for each $1 over $135,000 |
| $190,001 and over | $51,370 plus 45c for each $1 over $190,000 |
These rates are for Australian residents for tax and do not include the 2% Medicare levy. Sources: ATO: Tax rates, Australian residents; Treasury Laws Amendment (More Cost of Living Relief) Act 2025.
The first rate fell from 16% to 15%
From 1 July 2026 the rate on taxable income between $18,201 and $45,000 is 15%, down from 16% in 2024-25 and 2025-26. The other rates and thresholds are unchanged, so anyone with taxable income of $45,000 or more pays $268 less income tax. The same Act cuts the rate again, to 14%, from 1 July 2027.
| Taxable income | Tax on this income, 2025-26 |
|---|---|
| $0 to $18,200 | Nil |
| $18,201 to $45,000 | 16c for each $1 over $18,200 |
| $45,001 to $135,000 | $4,288 plus 30c for each $1 over $45,000 |
| $135,001 to $190,000 | $31,288 plus 37c for each $1 over $135,000 |
| $190,001 and over | $51,638 plus 45c for each $1 over $190,000 |
A $1,000 standard deduction applies from 2026-27
From the 2026-27 income year, an Australian resident who earns salary, wages or other assessable labour income can deduct the lesser of $1,000 and their assessable labour income, without spending the money or keeping records. The ATO applies it automatically when you lodge. It is reduced dollar for dollar by the work-related expenses you claim that it covers, such as car, travel, uniform, laundry and working-from-home costs, so if you claim more than $1,000 of those you get your actual claims instead. Union fees, professional association memberships and income protection, sickness or accident insurance premiums do not reduce it.
It is section 25-130 of the Income Tax Assessment Act 1997, added by Schedule 4 of the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (No. 49 of 2026, assented to on 26 June 2026), and applies to assessments for 2026-27 and later years. This calculator assumes you claim no other work-related expenses, so you get the full $1,000. Sources: Treasury Laws Amendment (Tax Reform No. 1) Act 2026; ATO: Standard deduction for work-related expenses.
The low income tax offset is up to $700
| Taxable income | Offset |
|---|---|
| $37,500 or less | $700 |
| $37,501 to $45,000 | $700 less 5c for each $1 over $37,500 |
| $45,001 to $66,667 | $325 less 1.5c for each $1 over $45,000 |
| Over $66,667 | Nil |
The ATO works out the offset when you lodge your return. It reduces your income tax, but not below zero, and any unused amount is not refunded. With it, there is no income tax on taxable income up to $22,866, which with the standard deduction is a salary of up to $23,866. ATO: Low income tax offset.
Tax on common salaries
| Salary | Income tax | Medicare levy | Take-home a year | Share paid in tax |
|---|---|---|---|---|
| $40,000 | $2,495.00 | $780.00 | $36,725.00 | 8.2% |
| $60,000 | $8,105.00 | $1,180.00 | $50,715.00 | 15.5% |
| $80,000 | $14,220.00 | $1,580.00 | $64,200.00 | 19.8% |
| $100,000 | $20,220.00 | $1,980.00 | $77,800.00 | 22.2% |
| $120,000 | $26,220.00 | $2,380.00 | $91,400.00 | 23.8% |
| $150,000 | $36,200.00 | $2,980.00 | $110,820.00 | 26.1% |
| $200,000 | $55,420.00 | $3,980.00 | $140,600.00 | 29.7% |
| $300,000 | $100,420.00 | $5,980.00 | $193,600.00 | 35.5% |
For a resident with salary as their only income, the $1,000 standard deduction and no other deductions, no HELP debt and appropriate private hospital cover (no Medicare levy surcharge). Super is paid on top.
Medicare levy, the surcharge and HELP
The Medicare levy is 2% of taxable income, reduced for singles with taxable income up to $35,013 on the latest published thresholds. People without appropriate private hospital cover pay the Medicare levy surcharge of 1% to 1.5% once income for surcharge purposes is above $105,000 as a single. Medicare levy and surcharge.
HELP and other study loan repayments are charged on repayment income above $69,528. HECS and HELP repayments.
Foreign residents and working holiday makers
Different rates apply. The ATO's latest published tables are for 2025-26 and are shown here for reference. It has not yet published tables for 2026-27; we found no legislated change for 2026-27, but have not been able to confirm the rates, so this calculator does not model either group. Foreign residents get no tax-free threshold and pay no Medicare levy. Check the ATO pages before relying on these.
| Foreign resident taxable income | Tax, 2025-26 |
|---|---|
| $0 to $135,000 | 30c for each $1 |
| $135,001 to $190,000 | $40,500 plus 37c for each $1 over $135,000 |
| $190,001 and over | $60,850 plus 45c for each $1 over $190,000 |
| Working holiday maker taxable income | Tax, 2025-26 |
|---|---|
| $0 to $45,000 | 15c for each $1 |
| $45,001 to $135,000 | $6,750 plus 30c for each $1 over $45,000 |
| $135,001 to $190,000 | $33,750 plus 37c for each $1 over $135,000 |
| $190,001 and over | $54,100 plus 45c for each $1 over $190,000 |
Working holiday makers are visa subclasses 417 and 462. Sources: ATO: Tax rates, foreign residents; ATO: Tax rates, working holiday makers.
Working Australians tax offset from 2027-28
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 also adds a working Australians tax offset from the 2027-28 income year: up to $250 for residents whose net labour income is above the tax-free threshold, and no more than the income tax on that labour income. It does not apply to 2026-27, so it is not included here. Treasury Laws Amendment (Tax Reform No. 1) Act 2026.
These figures are estimates based on the information you entered and the 2026-27 rates and thresholds published by the Australian Taxation Office, with the Medicare levy low-income thresholds for 2025-26, the latest published. They are general information, not tax, financial or legal advice. Your actual pay and tax can differ, for example because of other income, deductions, your family situation, allowances, salary packaging or how your employer runs payroll. Check your payslip, or ask your employer, a registered tax agent or the ATO, before relying on them.