Australian Income Tax Rates 2026–27
Resident tax brackets for 2026–27 and 2025–26, foreign resident and working holiday maker rates, the Medicare levy and surcharge, the low income tax offset and HECS-HELP repayment thresholds. Each table links to the ATO page it comes from.
Rates checked 12 October 2026 against the ATO · How we check rates
Resident tax rates 2026–27
These rates apply if you were an Australian resident for tax purposes for the whole year. They do not include the 2% Medicare levy.
| Taxable income | Tax on this income |
|---|---|
| 0 – $18,200 | Nil |
| $18,201 – $45,000 | 15c for each $1 over $18,200 |
| $45,001 – $135,000 | $4,020 plus 30c for each $1 over $45,000 |
| $135,001 – $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 |
Source: Tax rates – Australian resident, ATO, last updated 13 August 2026.
What changed on 1 July 2026: the rate on $18,201 – $45,000 went from 16% to 15%. The other brackets are unchanged, so anyone with taxable income above $45,000 pays $268 less income tax than in 2025–26. From the same date, residents with salary or wages also get a standard deduction of up to $1,000 for work-related expenses, applied automatically unless they claim more in actual expenses (ATO). See what the changes are worth on your salary with the tax cut calculator.
Rates 2025–26 and announced changes
| Taxable income | Tax on this income |
|---|---|
| 0 – $18,200 | Nil |
| $18,201 – $45,000 | 16c for each $1 over $18,200 |
| $45,001 – $135,000 | $4,288 plus 30c for each $1 over $45,000 |
| $135,001 – $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 |
Source: Tax rates – Australian resident, ATO, last updated 13 August 2026.
Announced changes
These changes are law but start after 2026–27. The ATO has not yet published a full rate table for them, so the calculators do not use them.
- From 1 July 2027: The 15% rate on taxable income between $18,201 and $45,000 falls to 14%. (ATO, last updated 13 May 2026)
- From 1 July 2027: A new non-refundable Working Australians tax offset of up to $250 for residents whose net labour income is above the tax-free threshold. (ATO, last updated 23 July 2026)
How tax brackets work
Each rate applies only to the slice of income inside its bracket. Earning more never lowers your take-home pay, because moving into a higher bracket only changes the rate on the dollars above that threshold.
Your marginal rate is the rate on your next dollar. Your average (effective) rate is your total tax divided by your taxable income, and it is always lower than the marginal rate once you earn above the tax-free threshold.
Worked example: taxable income of $100,000 in 2026–27
- First $18,200: no tax
- Next $26,800 at 15%: $4,020.00
- Next $55,000 at 30%: $16,500.00
Income tax comes to $20,520.00. The marginal rate is 30%, but the average rate is 20.52%. Add the 2% Medicare levy ($2,000.00) for a total of $22,520.00. To see the figures for your own pay, use the pay calculator. For offsets, the Medicare levy and the tax on common salaries, read how income tax works.
Foreign resident and working holiday maker rates
Foreign residents pay tax from the first dollar, with no tax-free threshold, no low income tax offset and no Medicare levy. Working holiday makers on visa subclass 417 or 462 pay 15% from the first dollar of their working holiday income up to $45,000, then the higher rates shown below.
Foreign residents 2026–27
The ATO foreign resident rates page (updated 1 June 2026) lists rates only up to 2025–26. Schedule 1 scale 3 for 2026–27 is consistent with unchanged rates, but no 2026–27 rate table is published, so none is recorded here.
Foreign residents 2025–26
| Taxable income | Tax on this income |
|---|---|
| 0 – $135,000 | 30c for each $1 |
| $135,001 – $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 |
Source: Tax rates – foreign resident, ATO, last updated 1 June 2026.
Working holiday makers 2026–27
| Taxable income | Tax on this income |
|---|---|
| 0 – $45,000 | 15c for each $1 |
| $45,001 – $135,000 | $6,750 plus 30c for each $1 over $45,000 |
| $135,001 – $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 makers 2025–26
| Taxable income | Tax on this income |
|---|---|
| 0 – $45,000 | 15c for each $1 |
| $45,001 – $135,000 | $6,750 plus 30c for each $1 over $45,000 |
| $135,001 – $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 |
Source: Schedule 15 – Tax table for working holiday makers (working holiday makers income tax rates, payments from 1 July 2026), ATO, last updated 17 June 2026. (2026–27)
Source: Tax rates – working holiday maker, ATO, last updated 1 June 2026. (2025–26)
Work out pay after tax at these rates with the working holiday tax calculator.
Medicare levy, low-income reduction and surcharge
Most residents pay a Medicare levy of 2% of their taxable income on top of income tax. On low incomes it is reduced or not charged: below the lower threshold there is no levy, and between the two thresholds it is phased in at 10c for each dollar above the lower threshold.
| Threshold | 2026–27 | 2025–26 |
|---|---|---|
| Singles: lower threshold (no levy at or below) | $28,011 | $28,011 |
| Singles: upper threshold (reduction ends) | $35,013 | $35,013 |
| Families: lower threshold | $47,238 | $47,238 |
| Families: added per dependent child (lower) | $4,338 | $4,338 |
| Families: upper threshold | Not yet published | $59,047 |
| Families: added per dependent child (upper) | Not yet published | $5,423 |
2026–27: The ATO has not yet published 2026–27 Medicare levy low-income thresholds for assessment. These are the figures the ATO's 2026–27 Schedule 1 states for withholding ($28,011 / $35,013); they equal the 2025–26 thresholds.
Source: Medicare levy reduction for low-income earners, ATO, last updated 30 June 2026.
Some people can claim a full or half exemption from the levy: those with certain medical conditions, foreign residents, and people not entitled to Medicare benefits. See the ATO’s Medicare levy exemption pages.
Medicare levy surcharge
The surcharge is an extra 1% to 1.5% for people who earn above the base tier and do not have appropriate private hospital cover. It is charged on top of the Medicare levy. Work out your own with the Medicare levy surcharge calculator.
| Tier | Singles | Families | Rate |
|---|---|---|---|
| Base tier | $105,000 or less | $210,000 or less | 0% |
| Tier 1 | $105,001 – $123,000 | $210,001 – $246,000 | 1% |
| Tier 2 | $123,001 – $164,000 | $246,001 – $328,000 | 1.25% |
| Tier 3 | $164,001 or more | $328,001 or more | 1.5% |
| Tier | Singles | Families | Rate |
|---|---|---|---|
| Base tier | $101,000 or less | $202,000 or less | 0% |
| Tier 1 | $101,001 – $118,000 | $202,001 – $236,000 | 1% |
| Tier 2 | $118,001 – $158,000 | $236,001 – $316,000 | 1.25% |
| Tier 3 | $158,001 or more | $316,001 or more | 1.5% |
Source: Medicare levy surcharge income, thresholds and rates, ATO, last updated 22 June 2026. Family thresholds rise by $1,500 for each dependent child after the first.
Low income tax offset
Residents earning under $66,667 get the low income tax offset automatically when they lodge a tax return. It reduces income tax by up to $700 but cannot create a refund on its own or reduce the Medicare levy.
| Taxable income | Offset |
|---|---|
| $37,500 or less | $700 |
| $37,501 – $45,000 | $700 minus 5c for each $1 over $37,500 |
| $45,001 – $66,666 | $325 minus 1.5c for each $1 over $45,000 |
| $66,667 and over | Nil |
Source: Low income tax offset, ATO, last updated 8 June 2026. The ATO page states the current LITO rules without naming income years.
HECS-HELP repayment thresholds
From 2025–26, compulsory repayments are worked out only on income above the repayment threshold, at rising rates, rather than as a percentage of your whole income. In the top band the repayment is a flat percentage of total repayment income. Repayment income is your taxable income plus reportable fringe benefits, reportable super contributions, net investment losses and exempt foreign employment income.
Work out your repayment and how long your debt will take to clear with the HECS calculator.
| Repayment income | Repayment |
|---|---|
| 0 – $69,528 | Nil |
| $69,529 – $129,717 | 15c for each $1 over $69,528 |
| $129,718 – $186,050 | $9,028 plus 17c for each $1 over $129,717 |
| $186,051 and over | 10% of your total repayment income |
| Repayment income | Repayment |
|---|---|
| 0 – $67,000 | Nil |
| $67,001 – $125,000 | 15c for each $1 over $67,000 |
| $125,001 – $179,285 | $8,700 plus 17c for each $1 over $125,000 |
| $179,286 and over | 10% of your total repayment income |
Source: Study and training loan repayment thresholds and rates, ATO, last updated 30 June 2026.
Frequently asked questions
What is the tax-free threshold?
Australian residents pay no income tax on the first $18,200 of taxable income each year. With the low income tax offset, a resident pays no income tax at all until their taxable income passes $22,866 in 2026–27, although the Medicare levy can still apply. Foreign residents do not get the threshold. If you have two jobs, claim it from one employer only, or too little tax will be withheld.
What is my marginal tax rate?
It is the rate on your next dollar of taxable income: the rate of the bracket your income falls in. For residents in 2026–27 that is 0%, 15%, 30%, 37%, 45% as income rises, and most people also pay the 2% Medicare levy on top. Your average rate is always lower, because the lower brackets still apply to the first part of your income. Our pay calculator shows both for your pay.
Who pays the Medicare levy surcharge?
Residents who do not hold an appropriate level of private patient hospital cover and whose income for surcharge purposes is above $105,000 for singles or $210,000 for families in 2026–27. The rate is 1% to 1.5% depending on income, and it is charged on top of the Medicare levy. Income for surcharge purposes includes reportable fringe benefits, reportable super contributions and net investment losses, and for couples it is combined.
Sources
- Tax rates – Australian resident (ATO, last updated 13 August 2026)
- Tax rates – foreign resident (ATO, last updated 1 June 2026)
- Schedule 15 – Tax table for working holiday makers (working holiday makers income tax rates, payments from 1 July 2026) (ATO, last updated 17 June 2026)
- Low income tax offset (ATO, last updated 8 June 2026)
- Medicare levy reduction for low-income earners (ATO, last updated 30 June 2026)
- Medicare levy surcharge income, thresholds and rates (ATO, last updated 22 June 2026)
- Study and training loan repayment thresholds and rates (ATO, last updated 30 June 2026)
- Tax rates – working holiday maker (ATO, last updated 1 June 2026)
- Medicare levy reduction – family income (ATO, last updated 30 June 2026)
- Personal income tax – new tax cuts for every Australian taxpayer (ATO, last updated 13 May 2026)
- Working Australians tax offset (ATO, last updated 23 July 2026)
- Medicare levy exemption (ATO)
Full formulas, assumptions and test cases are on our methodology page.