✅ Last verified: July 2026 — Source: Australian Taxation Office (ATO), Treasury.gov.au 2026-27
By Abdul Basit | July 24, 2026 | FinzoTools Blog
⚡ QUICK ANSWER
Australia’s new income tax rates took effect 1 July 2026. The key change: the 19% rate dropped to 16% on income between $18,201 and $45,000 — meaning most Australian workers take home $800–$1,300 more per year. The superannuation rate also increased to 12% from 11.5%. Use our free Australia Salary Calculator 2026-27 to see your exact new take-home pay.
Every year on 1 July, Australia’s financial year resets — and 2026 brings meaningful changes to income tax rates, superannuation, and student loan thresholds that affect millions of Australian workers. If you have not updated your take-home pay calculations since July 1, you may be underestimating your income.
In this guide, we break down every change effective from July 2026, show exactly how much more you will keep, and provide real take-home pay examples across common salary levels — using official ATO figures.
Australia new income tax brackets — 2026-27 vs previous years
| Taxable Income | 2024-25 Rate | 2025-26 Rate | 2026-27 Rate (NEW) | Change |
|---|---|---|---|---|
| $0 – $18,200 | 0% | 0% | 0% | No change |
| $18,201 – $45,000 | 19% | 16% | 16% | Same as 2025-26 |
| $45,001 – $135,000 | 32.5% | 30% | 30% | Same as 2025-26 |
| $135,001 – $190,000 | 37% | 37% | 37% | No change |
| $190,001+ | 45% | 45% | 45% | No change |
Source: Australian Taxation Office — Income tax rates 2026-27. Excludes Medicare levy (2%).
The Stage 3 tax cuts introduced in 2024-25 continued into 2026-27 with no further changes to the brackets themselves. The biggest benefit remains for workers earning $18,201–$135,000 who saw a 3–3.5 percentage point reduction compared to pre-2024 rates.
Real take-home pay examples — Australia 2026-27
Here is what workers at different salary levels actually take home in 2026-27, including income tax and Medicare levy (2%), before superannuation:
| Annual Salary | Income Tax | Medicare Levy (2%) | Total Deductions | Take-Home Pay | Monthly Take-Home |
|---|---|---|---|---|---|
| $40,000 | $3,488 | $800 | $4,288 | $35,712 | $2,976/mo |
| $60,000 | $9,488 | $1,200 | $10,688 | $49,312 | $4,109/mo |
| $80,000 | $16,288 | $1,600 | $17,888 | $62,112 | $5,176/mo |
| $100,000 | $22,288 | $2,000 | $24,288 | $75,712 | $6,309/mo |
| $120,000 | $28,288 | $2,400 | $30,688 | $89,312 | $7,443/mo |
| $150,000 | $40,288 | $3,000 | $43,288 | $106,712 | $8,893/mo |
| $200,000 | $60,667 | $4,000 | $64,667 | $135,333 | $11,278/mo |
Figures include Low Income Tax Offset (LITO) and Low and Middle Income Tax Offset (LMITO) where applicable. Excludes HECS repayments and superannuation. Source: ATO 2026-27.
💡 Want your exact take-home? Use our Australia Salary Calculator 2026-27 — includes Medicare levy, HECS, super and all offsets.
Key changes from 1 July 2026
1. Superannuation rate — now 12%
The superannuation guarantee increased from 11.5% to 12% on 1 July 2026. This means your employer must contribute 12% of your ordinary time earnings to your super fund — up from 11.5% last year.
| Salary | Super at 11.5% (2025-26) | Super at 12% (2026-27) | Extra Super/Year |
|---|---|---|---|
| $60,000 | $6,900 | $7,200 | +$300/year |
| $80,000 | $9,200 | $9,600 | +$400/year |
| $100,000 | $11,500 | $12,000 | +$500/year |
| $120,000 | $13,800 | $14,400 | +$600/year |
Source: ATO — Superannuation guarantee rate 2026-27
2. HECS-HELP repayment threshold — $54,435
The HECS-HELP compulsory repayment threshold for 2026-27 is $54,435. If your income exceeds this, you must make repayments at rates from 1% to 10% of your total income depending on your earnings level.
| Income Range | Repayment Rate | Annual Repayment ($80K) |
|---|---|---|
| Below $54,435 | Nil | $0 |
| $54,435 – $62,849 | 1% | ~$600 |
| $62,850 – $66,616 | 2% | ~$1,300 |
| $66,617 – $70,618 | 2.5% | ~$1,800 |
| $70,619 – $75,957 | 3% | ~$2,300 |
| $75,958 – $81,112 | 3.5% | ~$2,800 |
Source: ATO — HELP repayment thresholds 2026-27 (partial table)
3. Low Income Tax Offset (LITO) — unchanged
The Low Income Tax Offset remains at a maximum of $700 for 2026-27, reducing your tax bill if you earn under $66,667. It phases out between $37,500 and $66,667.
4. Medicare levy low-income threshold — updated
The Medicare levy low-income threshold for 2026-27 is $26,000 for singles. Below this threshold, you pay no Medicare levy. Between $26,000 and $32,500, a reduced rate applies.
How Australian tax rates compare internationally
| Country | Tax on $80K equiv. | Take-Home (approx) | Top Rate |
|---|---|---|---|
| 🇦🇺 Australia | $17,888 (incl Medicare) | $62,112 (78%) | 45% |
| 🇬🇧 United Kingdom | ~£19,500 | ~£60,500 (76%) | 45% |
| 🇮🇪 Ireland | ~€22,000 | ~€58,000 (73%) | 40% |
| 🇸🇬 Singapore | ~S$8,000 | ~S$72,000 (90%) | 24% |
| 🇦🇪 UAE | $0 | $80,000 (100%) | 0% |
Approximate comparisons only — each country has different deductions, social contributions and benefits. Exchange rates as at July 2026.
6 tips to reduce your Australian tax bill in 2026-27
- Maximise concessional super contributions — contribute up to $30,000/year to super at 15% tax instead of your marginal rate. On a $100K salary that is a saving of up to $4,500/year.
- Claim all work-related deductions — home office, work tools, professional development, union fees. Keep receipts for everything — even small deductions add up.
- Check your HECS balance — if your debt is small, consider voluntary repayments to eliminate the compulsory repayment from your income.
- Use a tax agent — the ATO reports that taxpayers using registered tax agents receive an average refund $600 higher than self-lodgers.
- Split income with a lower-earning spouse — contributing to a spouse’s super or using a family trust (where appropriate) can reduce your household tax bill legally.
- Lodge your tax return early — the ATO processes early lodgements first. If you are due a refund, lodging in July rather than October gets you money back sooner.
Frequently asked questions — Australia new tax rates 2026
What are the new Australian income tax rates for 2026-27?
The Australian income tax rates for 2026-27 are: 0% up to $18,200; 16% on $18,201–$45,000; 30% on $45,001–$135,000; 37% on $135,001–$190,000; and 45% above $190,000. Plus 2% Medicare levy for most taxpayers.
When did the new Australian tax rates start in 2026?
The 2026-27 tax rates took effect from 1 July 2026. The rates themselves are unchanged from 2025-26 — the major Stage 3 cuts happened in 2024-25 when the 19% rate dropped to 16% and 32.5% dropped to 30%.
How much more will I take home with the new Australian tax rates?
Compared to pre-2024 rates, workers on $60,000 take home approximately $1,290 more per year. On $80,000 the saving is approximately $1,290/year. On $45,000 the saving is approximately $804/year. The 2026-27 rates are the same as 2025-26.
What is the Medicare levy in Australia 2026?
The Medicare levy is 2% of taxable income for 2026-27. It applies to most taxpayers. Singles earning under $26,000 are exempt. Between $26,000 and $32,500, a reduced rate applies.
What is the HECS repayment threshold in Australia 2026?
The HECS-HELP repayment threshold for 2026-27 is $54,435. Income above this triggers compulsory repayments from 1% to 10% of total income depending on earnings level.
What is the superannuation rate in Australia 2026-27?
The superannuation guarantee rate for 2026-27 is 12%, up from 11.5% in 2025-26. Employers must contribute 12% of ordinary time earnings to your super fund.
What is the tax-free threshold in Australia 2026?
The tax-free threshold is $18,200. With the Low Income Tax Offset (LITO), the effective tax-free threshold is approximately $21,884 for residents.
Related tools and guides
- 🇦🇺 Australia Salary Calculator 2026-27 — updated July 2026 tax rates, Medicare, HECS and super
- 🏠 Australian Home Loan Calculator 2026 — monthly repayments and stamp duty
- 📖 RRSP vs TFSA 2026 — Canadian tax-free savings comparison
- 🇮🇪 Irish Pension Calculator 2026 — estimate your State Pension
- 🇬🇧 UK Salary Calculator 2026 — compare UK vs Australia take-home
- 🇸🇬 Singapore Salary Calculator 2026 — CPF and take-home pay
Sources & references
- Australian Taxation Office — Individual income tax rates 2026-27
- ATO — Superannuation guarantee 2026-27
- ATO — HECS-HELP repayment thresholds 2026-27
- Treasury.gov.au — Stage 3 tax cuts implementation
© 2026 FinzoTools — For educational purposes only. Verify all figures at ato.gov.au before making financial decisions.