Guides
Australian tax brackets 2026–27
Current Australian income tax brackets and marginal rates for residents in 2026–27 — including which tax bracket you are in, the tax-free threshold, residency categories and LITO.
What tax bracket am I in?
Enter a yearly taxable income to see the 2026–27 resident bracket. Australian rates are marginal: only the slice of income inside a band is taxed at that rate.
2026–27 resident marginal rate
30%
On $80,000 you are in the $45,001 – $135,000 bracket. Only income in that band is taxed at 30% — this is your marginal tax rate, not the rate on your whole salary.
Current tax brackets and marginal rates (2026–27)
Australian resident income tax rises in steps. Income under $18,200 sits in the tax-free threshold (0%). Higher portions of taxable income are taxed at higher marginal rates, up to 45%.
| Taxable income | Tax on this bracket | Marginal rate |
|---|---|---|
| $0 – $18,200 | Nil | 0% |
| $18,201 – $45,000 | $0 + 15% over $18,200 | 15% |
| $45,001 – $135,000 | $4,020 + 30% over $45,000 | 30% |
| $135,001 – $190,000 | $31,020 + 37% over $135,000 | 37% |
| $190,001 and over | $51,370 + 45% over $190,000 | 45% |
From 1 July 2026 the second bracket rate is 15% (it was 16% in 2024–25 and 2025–26). Our take-home calculator lets you switch tax years.
Tax-free threshold
Residents can usually claim the tax-free threshold on one job so the first $18,200 of taxable income is not taxed at the income-tax rate. If you have a second job, you typically claim the threshold on only one employer — tick “No tax-free threshold” in the calculator for the other job to mirror PAYG withholding.
Residency categories
- Australian resident — progressive brackets with the tax-free threshold (unless you claim it on another job).
- Foreign resident — no tax-free threshold; tax starts from the first dollar at non-resident rates.
- Working holiday maker — “backpacker tax” schedules apply for eligible 417 / 462 visa holders.
Low Income Tax Offset (LITO)
LITO reduces income tax for eligible lower incomes (phasing out by about $66,667 of taxable income). It is applied in annual tax calculations and on your tax return — not as a separate line on every payslip. TaxPayCalculator includes LITO in the annual income-tax estimate where it applies. It does not reduce Medicare or HELP.
PAYG vs annual tax
Employers withhold using ATO PAYG formulas (Schedule 1 for weekly/fortnightly/monthly; casual daily tables for daily pay). Those instalments can differ slightly from a full-year tax calculation after offsets. Differences are usually settled when you lodge your return.
Common questions
What tax bracket am I in in Australia?
Your Australian tax bracket is the highest resident band that includes your taxable income. For 2026–27 the brackets are $0 – $18,200 at 0%; $18,201 – $45,000 at 15%; $45,001 – $135,000 at 30%; $135,001 – $190,000 at 37%; $190,001 and over at 45%. Only dollars inside that band are taxed at that marginal rate — income below it is taxed at lower rates.
What are the current tax brackets in Australia?
Current Australian resident income tax brackets for 2026–27 are $0 – $18,200 at 0%; $18,201 – $45,000 at 15%; $45,001 – $135,000 at 30%; $135,001 – $190,000 at 37%; $190,001 and over at 45%. The tax-free threshold is $18,200. From 1 July 2026 the $18,201–$45,000 band is 15%.
Are Australian tax brackets marginal rates?
Yes. Australian income tax is progressive: each bracket’s rate applies only to income in that range, not to your whole salary. Your marginal rate is the rate on your last dollar earned.
General information only — not personal tax advice. Confirm current rates on the ATO website.