Australian tax brackets and rates 2026-27
The 2026-27 Australian tax brackets for residents are 0% up to $18,200, 15% to $45,000, 30% to $135,000, 37% to $190,000 and 45% above $190,000. They apply from 1 July 2026 to 30 June 2027 and exclude the 2% Medicare levy (ATO tax rates for Australian residents (opens in a new tab)).
By Calculatax
These rates are the starting point for income tax in Australia. Offsets, the Medicare levy and any HELP repayment are applied afterwards.
| 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 |
Figures checked 1 November 2026. Change log: 1 July 2026, the 16% rate became 15% and the base amounts fell by $268.
What changed on 1 July 2026: 16% became 15%
Only the second bracket rate moved. The thresholds stayed at $18,200, $45,000, $135,000 and $190,000, and the 30%, 37% and 45% rates are unchanged.
Because the 15% band is $26,800 wide, a one-point cut is worth $268 to anyone who fills it. That's why each base amount is exactly $268 lower than in 2025-26.
Base amount at
2025-26
- $45,000
- $4,288
- $135,000
- $31,288
- $190,000
- $51,638
2026-27
- $45,000
- $4,020
- $135,000
- $31,020
- $190,000
- $51,370
The cut was legislated by the Treasury Laws Amendment (More Cost of Living Relief) Act 2025 (opens in a new tab). The same Act cuts the rate again, to 14%, from 1 July 2027.
Tax payable at each threshold: $18,200, $45,000, $135,000 and $190,000
The base amount in each row is the tax on all the bands below it. Adding $27,000 ($90,000 × 30%) to $4,020 gives $31,020, and adding $20,350 ($55,000 × 37%) gives $51,370.
| Taxable income | Income tax | Average income tax rate | Total with LITO and Medicare levy | Average total rate |
|---|---|---|---|---|
| $18,200 | $0 | 0% | $0 | 0% |
| $45,000 | $4,020 | 8.93% | $4,595 | 10.21% |
| $135,000 | $31,020 | 22.98% | $33,720 | 24.98% |
| $190,000 | $51,370 | 27.04% | $55,170 | 29.04% |
Even at $190,000, the average total rate is under 30%. Someone earning exactly at a threshold pays the lower rate on every dollar, and the higher rate starts with the next dollar.
Your top rate is not your tax rate: an $80,000 example
An $80,000 earner is in the 30% bracket, yet pays 18.15% of income in income tax. The 30% applies only to the $35,000 above $45,000.
| Slice of the $80,000 | Rate | Tax |
|---|---|---|
| $0 to $18,200 | 0% | $0 |
| $18,201 to $45,000 | 15% | $4,020 |
| $45,001 to $80,000 | 30% | $10,500 |
| Income tax | 18.15% average | $14,520 |
| Plus Medicare levy | 2% | $1,600 |
| Total | 20.15% average | $16,120 |
The marginal rate, 32% with the levy, prices the next dollar. The average rate, 20.15%, describes the whole salary.
A pay rise is taxed at the marginal rate, but it never pulls earlier dollars into a higher bracket. Marginal tax rates show both figures for any income.
Bracket creep: why wage growth lifts your average rate
Over time the thresholds stay fixed unless the government changes them, so wage growth pushes the average rate up. This is bracket creep.
If the $80,000 salary rose 3.7%, in line with full-time ordinary earnings to May 2026 (ABS), it would reach $82,960. The average total rate would climb from 20.15% to 20.57%.
Rates for 2025-26 and 2024-25 returns
Returns for 2025-26 use the 16% table below. The same table applied in 2024-25.
| Taxable income | Tax on this income |
|---|---|
| $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 |
With 2025-26 rates and the low income tax offset, no income tax is payable up to $22,575. For 2026-27 that figure is $22,866.
Foreign resident and working holiday maker scales
Foreign residents get no tax-free threshold and pay no Medicare levy. The ATO page shows a 2025-26 table only, but the 2026-27 withholding formulas use the same rates.
| Foreign resident taxable income | Tax on this income |
|---|---|
| $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 makers pay 15% from the first dollar, then resident rates above $45,000.
| Working holiday maker taxable income | Tax on this income |
|---|---|
| $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 maker's tax on $80,000
- $17,250
- Foreign resident's tax on $80,000
- $24,000
The foreign resident tax rates calculator applies the first scale to any income.
The Medicare levy is charged outside the brackets
The Medicare levy is 2% of your whole taxable income, not a sixth bracket. It adds two points to every marginal rate once you're past the low-income range.
Under the latest announced (2025-26) thresholds, a single person pays no levy up to $28,011. Between $28,011 and $35,013 the levy phases in at 10 cents per dollar above the threshold, which briefly lifts the marginal rate to 25%.
Who reaches the 45% bracket
Only taxable income above $190,000 is taxed at 45%, or 47% with the Medicare levy. That threshold is about 1.75 times average full-time adult ordinary earnings, which were $108,352 a year in May 2026 (ABS).
The income tax calculator adds HELP and the Medicare levy surcharge to these figures. Employers apply the rates through the ATO tax tables and the PAYG withholding calculator uses the same formulas.
What 45% means on a $250,000 income
Even well inside the top bracket, most income is taxed at lower rates. On $250,000, only $60,000 attracts 45%, and the total bill of $83,370 is an average of 33.35%.
Tax bracket questions: your bracket, the tax-free threshold and the 14% rate from 2027-28
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What are the tax brackets in Australia?
For 2026-27, Australia has five resident tax brackets: 0% to $18,200, 15% to $45,000, 30% to $135,000, 37% to $190,000 and 45% above. Each rate applies only to income inside its band. The 2% Medicare levy is charged separately on top, and foreign residents use a different scale starting at 30%.
What tax bracket am I in?
Your bracket is the band your last dollar of taxable income falls in. For 2026-27, income of $45,001 to $135,000 is in the 30% bracket. If a pay rise takes you from $130,000 to $140,000, only the $5,000 above $135,000 is taxed at 37%. The first $130,000 is taxed exactly as before.
What is the tax-free threshold?
The tax-free threshold is $18,200 for Australian residents in 2026-27, unchanged from 2025-26. No income tax is charged on the first $18,200. With the $700 low income tax offset, residents pay no income tax up to $22,866. Foreign residents get no tax-free threshold, and working holiday makers pay 15% from the first dollar.
What is the tax rate in Australia?
Resident rates for 2026-27 are 0%, 15%, 30%, 37% and 45%, plus the 2% Medicare levy. The 15% rate falls to 14% on 1 July 2027. With the other thresholds unchanged, anyone earning $45,000 or more would pay $268 less a year from 2027-28.
Keep going
Sources
- ATO: Tax rates, Australian residents (opens in a new tab)
- ATO: Personal income tax: new tax cuts for every Australian taxpayer (opens in a new tab)
- Federal Register of Legislation: Treasury Laws Amendment (More Cost of Living Relief) Act 2025 (opens in a new tab)
- ATO: Tax rates, foreign residents (opens in a new tab)
- ATO: Tax rates, working holiday makers (opens in a new tab)