Australian Tax Brackets 2026-27

Australian Resident Tax Brackets (2026-27 Financial Year)

Australia uses a progressive income tax system, meaning different portions of your income are taxed at different rates. The table below shows the official Australian resident tax brackets for the 2026-27 financial year, applicable to individuals who claim the tax-free threshold. These income tax rates are used by our calculator to estimate your take-home pay after tax.

Cumulative tax shows the total income tax payable if your taxable income is at the top of that bracket. It does not include the Medicare Levy (2%).

How Much Tax Do I Pay? Quick Reference (2026-27)

The table below shows the total tax (income tax + 2% Medicare Levy) at common salary levels for 2026-27. These figures include the automatic $1,000 work deduction and assume a resident claiming the tax-free threshold, with no HELP debt, MLS or salary sacrifice.

Worked Example: $80,000 Salary

Worked Example: $100,000 Salary

Low Income Tax Offset (LITO)

The Low Income Tax Offset reduces the amount of income tax you pay. It is worth up to $700 for taxable incomes up to $37,500, then phases down at 5 cents per dollar between $37,501 and $45,000 (reducing the offset to $325), and at 1.5 cents per dollar between $45,001 and $66,667 until it reaches zero. LITO is a non-refundable offset — it can reduce your tax to zero but won't generate a refund.

You don't need to do anything to claim LITO — it is applied automatically when you lodge your tax return or through your employer's PAYG withholding adjustments during the year.

Medicare Levy

In addition to income tax, most Australian residents pay the Medicare Levy — a charge of 2% of taxable income that funds Australia's public healthcare system. For a $100,000 gross salary in FY 2026-27, the automatic deduction leaves $99,000 taxable income, so the levy is $1,980.

The FY 2026-27 thresholds are not yet separately published, so the calculator explicitly carries the latest individual threshold of $28,011 and shade-in threshold of $35,013 pending legislation.

Medicare Levy Surcharge (MLS) Thresholds

Higher-income earners without an appropriate level of private hospital cover pay the Medicare Levy Surcharge on top of the standard 2% Medicare Levy. For 2026-27, the individual income thresholds are:

Family thresholds are double the individual thresholds, plus $1,500 per dependent child after the first.

Non-Resident Tax Brackets

Non-residents (foreign residents for tax purposes) do not receive a tax-free threshold, LITO, or SAPTO. They also do not pay the Medicare Levy. All income is taxed from the first dollar.

Stage 3 Tax Cuts

From 1 July 2024, the Stage 3 tax cuts reduced the 19% bracket to 16%, lowered the 32.5% bracket to 30%, and raised the 37% threshold from $120,000 to $135,000. These changes benefit all taxpayers earning above $18,200.

The lower resident rate changed on 1 July 2026. The former 16% bracket is now 15% for the 2026-27 financial year, and then to 14% from 1 July 2027. The tax-free threshold and all other brackets remain unchanged.

The calculator also applies the FY 2026-27 automatic $1,000 work-related deduction. Medicare low-income thresholds are carried from the latest legislated amounts until updated figures are enacted.

Working Holiday Maker Rates

Working holiday makers (visa subclass 417 & 462) pay a flat 15% on income up to $45,000, then standard rates above that. They do not receive the tax-free threshold. The rates below apply when the employer is registered as a working holiday maker employer with the ATO.

Compare Two Salaries

Considering a job offer or pay rise? Compare the after-tax impact of two different salary packages side-by-side, including different super rates and salary sacrifice amounts.