ATO Income Tax Brackets 2026-27
- $0 – $18,200 → 0% (tax-free threshold)
- $18,201 – $45,000 → 15% (reduced from 16% from 1 July 2026)
- $45,001 – $135,000 → 30%
- $135,001 – $190,000 → 37%
- Above $190,000 → 45%
The 2% Medicare Levy applies in addition to these rates for most residents.
Superannuation (Super)
From 1 July 2026, your employer must contribute 12% of your ordinary-time earnings to your super fund. This is paid in addition to your salary (not deducted from it), so it doesn't reduce your take-home pay directly — but it's part of your total compensation package.
Low Income Tax Offset (LITO)
If your taxable income is below $66,667, you may be entitled to the LITO of up to $700. This reduces your income tax payable — the offset phases out between $37,500 and $66,667.
What is the take-home pay on $85,000 in Australia?
On $85,000 gross, you'd pay approximately $17,547 in income tax and $1,700 Medicare levy. With LITO the net tax is around $17,247. Take-home pay is approximately $66,053 per year (~$5,504/month). Your employer would also contribute $10,200 to your super fund.
What is HECS/HELP debt repayment?
If you have a university student loan (HELP/HECS), you repay it through the tax system once your income exceeds $54,435. Repayment rates range from 1% to 10% of your income depending on how much you earn.
Do non-residents pay the same tax?
No. Non-residents are taxed at a flat 32.5% on income from $0–$135,000 (no tax-free threshold), then 37% and 45% at higher levels. Non-residents also don't pay the Medicare levy.
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