Australian Tax Bracket Calculator 2026-27
The brackets just changed: on 1 July 2026 the 16% rate dropped to 15% — worth up to $268 a year — and a further cut to 14% from July 2027 is already law.
An interactive tax bracket visualiser for 2026-27: type your taxable income and watch it fill each bracket — $18,200 tax-free, then 15%, 30%, 37% and 45%. See the exact tax paid in every band, your marginal and effective rate, the optional 2% Medicare levy, and what the 2026 and 2027 rate cuts are worth at your income. Estimates only — not financial advice.
ATO resident rates for 2026-27. Bracket-scale tax only — offsets not included. Estimates only — not financial advice.
📐 How it worksThe 2026-27 Australian tax brackets — and how bracket tax actually works
Each rate applies only inside its band
Australia's income tax is progressive and marginal: your income is sliced into bands, and each band is taxed at its own rate. Nobody pays 30% "on their income" — they pay 30% only on the dollars that fall between $45,001 and $135,000. That's why the calculator above shows a separate tax figure for every bracket your income touches.
| Taxable income | Rate | Tax on the full band | Total tax at the top of the band |
|---|---|---|---|
| $0 – $18,200 | 0% | $0 | $0 |
| $18,201 – $45,000 | 15% | $4,020 | $4,020 |
| $45,001 – $135,000 | 30% | $27,000 | $31,020 |
| $135,001 – $190,000 | 37% | $20,350 | $51,370 |
| $190,001+ | 45% | — | — |
Reading the table: someone on exactly $135,000 pays $0 + $4,020 + $27,000 = $31,020 before the Medicare levy. Someone on $200,000 pays $51,370 plus 45% of the last $10,000 — $55,870. The stacked bar above draws exactly this: your income filling each band at its own rate.
What this page deliberately leaves out
This is a bracket calculator, so it shows tax from the rate scale only. It excludes the low income tax offset (LITO), Medicare levy reductions and exemptions, the Medicare levy surcharge, HELP repayments and any other offsets or levies. That keeps every figure exactly reconcilable against the ATO rate table — for your actual take-home pay, use the Pay Calculator or the Income Tax Calculator.
✂️ The cuts16% → 15% → 14%: the July 2026 cut and the legislated 2027 follow-up
On 1 July 2026 the rate on the $18,201–$45,000 band fell from 16% to 15%, and a second step to 14% from 1 July 2027 is already legislated. The thresholds themselves don't move — only the second band's rate changes:
| Taxable income | 2024-25 & 2025-26 | 2026-27 (current) | 2027-28 (legislated) |
|---|---|---|---|
| $0 – $18,200 | 0% | 0% | 0% |
| $18,201 – $45,000 | 16% | 15% | 14% |
| $45,001 – $135,000 | 30% | 30% | 30% |
| $135,001 – $190,000 | 37% | 37% | 37% |
| $190,001+ | 45% | 45% | 45% |
What it's worth at your income
Each 1% step is worth 1% of your income between $18,200 and $45,000. Earn $45,000 or more and you get the full band: $268 a year saved in 2026-27, and $536 a year from 2027-28, both against the 2024-25 scale. Earn between the thresholds and the saving scales with your income — at $30,000, the 2026-27 cut saves $118. Switch the calculator to Detailed and the comparison rows price all three years at your exact income.
Got a pay rise at the same time as the cut? Separate the two effects with the Pay Rise Calculator.
⚖️ Two ratesMarginal vs effective: why "being in the 30% bracket" doesn't mean paying 30%
A full worked example at $90,000
Take the calculator's default income of $90,000 in 2026-27. The first $18,200 is tax-free. The next $26,800 (from $18,201 to $45,000) is taxed at 15% — $4,020. The remaining $45,000 (from $45,001 to $90,000) is taxed at 30% — $13,500. Total: $17,520 before the Medicare levy.
So the marginal rate — the tax on the next dollar earned — is 30%. But the effective rate — total tax over total income — is $17,520 ÷ $90,000 = 19.5%. Add the 2% Medicare levy ($1,800) and the total is $19,320, an effective 21.5%.
| Taxable income | Income tax | Marginal rate | Effective rate |
|---|---|---|---|
| $45,000 | $4,020 | 15% | 8.9% |
| $90,000 | $17,520 | 30% | 19.5% |
| $135,000 | $31,020 | 30% | 23.0% |
| $190,000 | $51,370 | 37% | 27.0% |
| $200,000 | $55,870 | 45% | 27.9% |
Use the marginal rate for decisions about extra income and deductions — overtime, a second job, salary sacrifice, the value of a deduction. Use the effective rate to understand your overall tax burden. The calculator shows both, live.
🧠 The myth"A pay rise will push me into a higher bracket and I'll lose money" — no, it won't
Crossing a threshold only taxes the dollars above it
The most persistent tax myth in Australia is that crossing a bracket threshold makes you worse off. It can't. If you're on $135,000 and get a $1,000 rise, only that $1,000 is taxed at the new 37% rate — $370 of tax, $630 kept (before the Medicare levy). Every dollar below $135,000 keeps exactly the rates it had before. A rise in gross pay always increases your after-tax pay under the rate scale.
Set the calculator to Advanced and the "next dollar" row prices your marginal rate directly, while the threshold rows show how far you are from each bracket boundary.
Bracket creep — the real (and slower) issue
What the myth gets half-right is bracket creep: the thresholds are fixed in dollars ($18,200, $45,000, $135,000, $190,000 in 2026-27), so as wages grow over the years, more of each pay packet drifts into the higher bands and your effective rate creeps up — even with no real pay increase. Rate cuts like July 2026's and July 2027's are how governments periodically hand bracket creep back. You never lose money from a rise; inflation just quietly changes what your effective rate is.
Weigh up a specific offer with the Pay Rise Calculator, or blunt your marginal rate with pre-tax contributions via the Salary Sacrifice Calculator.
🏥 On top & off the topThe 2% Medicare levy — and the new $1,000 instant work deduction
The Medicare levy sits on top of the brackets
Most taxpayers pay a Medicare levy of 2% of taxable income in addition to bracket-scale tax — at $90,000 that's another $1,800. It isn't part of the rate scale, which is why this calculator keeps it as a separate toggle (Standard level) and labels the headline accordingly. Low-income earners pay a reduced levy or none at all below the income thresholds, seniors and pensioners get higher thresholds, and some taxpayers — including many non-residents — are exempt. This page applies a flat 2% with no reductions modelled. Higher earners without private hospital cover can also face the separate Medicare levy surcharge, which isn't included here either.
New from 1 July 2026: the $1,000 instant deduction
From the 2026-27 income year you can claim a $1,000 instant standard deduction for work-related expenses — no receipts required. If your actual work-related expenses exceed $1,000, you can still claim them the usual way instead; the instant deduction simply removes the paperwork for everyone below that line. Because deductions reduce taxable income, its value depends on your marginal rate: up to $300 at 30%, up to $370 at 37%. This calculator takes taxable income as its input, so enter your income after deductions.
❓ FAQFrequently asked questions
What are the Australian tax brackets for 2026-27?
For Australian residents in 2026-27: $0 to $18,200 is tax-free; $18,201 to $45,000 is taxed at 15%; $45,001 to $135,000 at 30%; $135,001 to $190,000 at 37%; and income over $190,000 at 45%. The 15% rate is new — it was cut from 16% on 1 July 2026. Most taxpayers also pay a 2% Medicare levy on top.
What is the difference between my marginal and effective tax rate?
Your marginal rate is the rate on your last (and next) dollar; your effective rate is your total tax divided by your total income. On $90,000 in 2026-27: the first $18,200 is tax-free, 15% on the next $26,800 is $4,020, and 30% on the $45,000 above that is $13,500 — $17,520 in total before the Medicare levy. The marginal rate is 30%, but the effective rate is just 19.5%.
Why did my tax go down in July 2026?
The rate on the $18,201–$45,000 band was cut from 16% to 15% on 1 July 2026, so employers withhold slightly less tax from every pay. Anyone with taxable income of $45,000 or more saves the full $268 a year compared with 2025-26; between $18,200 and $45,000 the saving is 1% of the income above $18,200.
What changes on 1 July 2027?
A further cut is already legislated: the 15% rate on the $18,201–$45,000 band drops to 14% from 1 July 2027. That's worth another $268 a year for incomes of $45,000 or more — a combined $536 a year compared with the 2024-25 rates. Use the tax-year selector at the Detailed level to preview your 2027-28 tax.
Does a pay rise push me into a higher tax bracket and leave me worse off?
No — this is the most persistent tax myth in Australia. Only the dollars above a threshold are taxed at the higher rate, never your whole income. If you're on $135,000 and get a $1,000 rise, only that $1,000 is taxed at 37% ($370); everything below keeps its existing rates, so you always take home more after a rise.
Do these figures include the Medicare levy?
Not by default — the headline figure is income tax from the bracket scale only, and it's labelled that way. Switch to the Standard level to add the 2% Medicare levy. The calculator applies a flat 2%: in reality low-income earners pay a reduced levy or none at all below the income thresholds (with higher thresholds for seniors and pensioners), and some taxpayers are exempt.
What is the $1,000 instant work deduction?
From 1 July 2026 you can claim a $1,000 instant standard deduction for work-related expenses without keeping receipts. If your actual work-related expenses are more than $1,000 you can still claim them the usual way instead. Deductions reduce taxable income, so at a 30% marginal rate the instant deduction is worth up to $300 of tax.
Are the tax brackets different for non-residents?
Yes. Foreign residents for tax purposes get no $18,200 tax-free threshold — in 2026-27 they pay 30c from the first dollar up to $135,000, then 37% and 45% at the same thresholds as residents — and they generally don't pay the Medicare levy. This calculator uses resident rates; residency for tax is decided by ATO rules, not citizenship.
How do the 2026-27 brackets compare with earlier years?
The thresholds — $18,200, $45,000, $135,000 and $190,000 — are unchanged from 2024-25. What changes is the rate on the second band: 16% in 2024-25 and 2025-26, 15% in 2026-27, and a legislated 14% from 2027-28. The 30%, 37% and 45% rates are unchanged across all four years.