5 tax brackets with $18,200 tax-free threshold + 2% Medicare levy
Australia's hidden advantage: no state income tax since 1942—unlike the US/Canada. A $100,000 AUD earner pays ~$22,967 income tax + $2,000 Medicare levy = $24,967 total (~25%). The 2024 Stage 3 cuts dropped the 19% bracket to 16%. Non-residents beware: you pay 30% from dollar one with no tax-free threshold.
The Australian tax system uses a progressive structure with 5 tax brackets for the 2025-26 financial year. The tax-free threshold of $18,200 means you pay no tax on income below this amount. Following the Stage 3 tax cuts, the second bracket rate dropped to 16% (previously 19%). All Australian residents also pay a 2% Medicare levy on taxable income. Use our ATO-compliant calculator below to estimate your Australian income tax, including the Medicare levy and any applicable offsets.
| Taxable Income | Tax Rate |
|---|---|
| A$0 - A$18,200 | 0% (tax-free) |
| A$18,201 - A$45,000 | 16% |
| A$45,001 - A$135,000 | 30% |
| A$135,001 - A$190,000 | 37% |
| Over A$190,000 | 45% |
Note: These are marginal rates - you only pay the higher rate on income within each bracket.
Source: Australian Taxation Office (ATO)
CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. This helps us provide free tax calculators and comparison tools. Learn more about our affiliate partnerships
★ 4.3 Trustpilot · 287,413 reviews
Transfer money to or from Australia at the real exchange rate. Save up to 5x vs banks on AUD transfers.
⚠ For currency exchange only — not a bank account replacement.
Send Money To/From Australia →★ 4.8 Trustpilot · 1,625 reviews
US citizen living in Australia? Get expert help with your US tax filing from abroad.
⚠ Not the cheapest option — best for complex situations and expats who want a dedicated CPA.
US Citizens: File Your US Taxes →★ 4.7 Trustpilot · 8,728 reviews
Working as a contractor in Australia? Deel handles compliance, payroll, and international payments.
⚠ For employers and companies only — not for individual freelancers or employees.
Get Paid as a Contractor →For the 2025-26 financial year (July 2025 - June 2026), Australian resident tax brackets are: 0% on income up to $18,200 (tax-free threshold), 16% on $18,201-$45,000, 30% on $45,001-$135,000, 37% on $135,001-$190,000, and 45% on income over $190,000. The 2% Medicare levy applies in addition to these rates.
The Australian tax-free threshold is $18,200 per year for residents. This means you pay no income tax on the first $18,200 you earn. Non-residents do not receive the tax-free threshold and are taxed from the first dollar at 30%.
For the 2025-26 financial year, individual tax returns are due by 31 October 2026 if you lodge yourself. If you use a registered tax agent, you may have an extended deadline up to 15 May 2027, depending on your circumstances. The Australian financial year runs from 1 July to 30 June.
The Medicare levy is an additional 2% tax on your taxable income that funds Australia's public healthcare system. Most Australian residents pay this levy. Low-income earners may be eligible for a reduction or exemption if their taxable income is below $26,000 (for singles). There's also a Medicare Levy Surcharge (1-1.5%) for high earners without private hospital cover.
Non-residents do not receive the $18,200 tax-free threshold. They pay 30% on income from $0 to $135,000, 37% on $135,001-$190,000, and 45% on income over $190,000. Non-residents are not required to pay the Medicare levy. Working holiday makers (visa 417/462) have special rates: 15% on the first $45,000.
Last Updated: March 2026