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Income Tax Calculator

Enter your annual salary and see exactly what you owe in income tax and Medicare Levy for 2025-26.

Financial Year

Employment Income

Employment Income Frequency

Other Taxable Income

Other Income Frequency

Your Payable Tax

$ 0.00

FAQs

What are the income tax brackets in Australia for 2025-26?

0% on the first $18,200, then 16% on $18,201–$45,000, 30% on $45,001–$135,000, 37% on $135,001–$190,000, and 45% above $190,000. These are the rates after the Stage 3 tax cuts that took effect 1 July 2024. They do not include the 2% Medicare Levy.

What is the tax-free threshold in Australia?

The first $18,200 of taxable income is tax-free for Australian residents. With the Low Income Tax Offset (LITO) factored in, you effectively pay no income tax until your income exceeds approximately $22,575 to $24,000 in 2025-26, depending on your individual circumstances.

Do I have to pay the Medicare Levy?

Most Australian residents pay the Medicare Levy at 2% of their taxable income. It funds Australia's public health system. Low-income earners may pay a reduced amount or nothing if their income is below the threshold (check the ATO's current figures, which are indexed annually). A Medicare Levy Surcharge of 1%–1.5% applies on top for higher earners without private hospital cover.

What is the difference between marginal tax rate and effective tax rate?

Your marginal rate is the rate on your last dollar of income. Your effective rate is total tax divided by total income — it is always lower than your marginal rate because the lower brackets are taxed at lower rates. Someone earning $85,000 has a marginal rate of 30% but an effective rate of around 20-21%.

How does HECS/HELP affect my tax?

HECS-HELP repayments are separate from income tax. From 1 July 2025, a new marginal repayment system applies — you only repay on income above the $67,000 threshold (up from $54,435 previously), not on your total income. Between $67,001 and $125,000 you repay 15 cents per dollar above $67,000. Above $125,001 the rate increases further. This change means most borrowers pay significantly less each year than under the old system.

Does the tax calculator include superannuation?

Employer super contributions (currently 12%) come on top of your salary and are taxed at 15% inside the fund — not at your marginal rate. This calculator works on salary only. Your take-home pay does not include super because it goes directly to your fund.

What is the Low Income Tax Offset (LITO)?

LITO reduces your tax liability by up to $700 if you earn under $37,500. It phases out gradually and disappears entirely at $66,667. It is applied automatically — you do not need to claim it.

Can I reduce my taxable income?

Yes. Allowable deductions include work-related expenses (tools, uniforms, home office), self-education costs, income protection insurance premiums, and investment-related expenses. Salary sacrifice to superannuation also reduces your taxable income. You cannot deduct personal or private expenses.

Why does my payslip tax differ from this calculator?

Your employer withholds tax based on an assumed full-year income for each pay period. If your income fluctuates, or you work part of the year, the final tax owed will differ. The actual amount is calculated when you lodge your tax return and any difference is refunded or becomes a debt.

How does this affect accounting firms using Ezyiah?

Accurate income tax calculations start with accurate income figures. If a client's transactions are miscoded in their accounting software, their taxable income is wrong at year-end. Ezyiah categorises every transaction from bank statements before the data reaches your software, so the income figure the accountant works from is correct.