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Tax-year changes, Australia

Australia tax changes for 2026-27

From 1 July 2026 the 16% tax rate falls to 15%, and the Medicare levy surcharge and HELP repayment thresholds rose with indexation. Here is each rule side by side, and what it does to your pay.

Reviewed by CentExactRules effective 2 sources

The 16% rate became 15%

On 1 July 2026 the rate on taxable income between $18,200 and $45,000 fell from 16% to 15%. It is the first of two cuts to that bracket made by the Treasury Laws Amendment (More Cost of Living Relief) Act 2025: the rate falls again, to 14%, from 1 July 2027. The thresholds did not move, and nor did the 30%, 37% and 45% rates above them.

Because the cut is one percentage point on a bracket 26,800 dollars wide, the most it is worth is 268 dollars a year, and every resident earning more than 45,000 dollars gets exactly that, which is why the first impact table shows the same gain from that salary up. Below it the gain is 1% of whatever you earn above the tax-free threshold. Working holiday makers and foreign residents are on their own scales, which did not change.

The surcharge and HELP thresholds were indexed

If you do not hold private hospital cover, the Medicare levy surcharge now starts above $105,000 instead of $101,000, with tier 2 from $123,000 and tier 3 from $164,000. A single person on 120,000 dollars dropped from tier 2 into tier 1, which is the larger gain in the second impact table.

HELP repayments start at $69,528, up from $67,000, the first indexation of the marginal system that began in 2025-26: you repay 15% of income above the threshold, then $9,028 plus 17% above $129,717, and a flat 10% of all your income above $186,050. A higher threshold lowers the repayment at every income in the marginal bands, so in those bands the HELP table gains more than the tax cut alone. Above the flat-rate threshold both years take 10% of all income, so there the gain is the tax cut only.

What stayed the same

The Medicare levy is still 2%, and the low income tax offset is still at most $700. The levy's low-income thresholds, $28,011 and $35,013 for a single person, show no change only because the thresholds for an income year are set in the following year's Budget: these are the 2025-26 figures, and the 2026-27 ones are not yet known. Your employer still pays 12% super guarantee on top of your salary. To see your own figure, try your salary in the take-home pay calculator.

Every rule, 2025-26 and 2026-27

11 of the 51 rules below changed. Each value is read from the 2025-26 and 2026-27 datasets, so a rule appears as changed only if the published figure changed.

Income tax, residents

Income tax, residents: 2025-26 and 2026-27
Rule2025-262026-27Change
Second bracket: rate16%15%−1 pp
First bracket: ends at$18,200$18,200No change
First bracket: rate0%0%No change
Second bracket: ends at$45,000$45,000No change
Third bracket: ends at$135,000$135,000No change
Third bracket: rate30%30%No change
Fourth bracket: ends at$190,000$190,000No change
Fourth bracket: rate37%37%No change
Fifth bracket: rate45%45%No change

Medicare levy surcharge (no private cover)

Medicare levy surcharge (no private cover): 2025-26 and 2026-27
Rule2025-262026-27Change
Base tier: ends at$101,000$105,000+$4,000
Tier 1: ends at$118,000$123,000+$5,000
Tier 2: ends at$158,000$164,000+$6,000
Base tier: rate0%0%No change
Tier 1: rate1%1%No change
Tier 2: rate1.25%1.25%No change
Tier 3: rate1.5%1.5%No change

HELP repayments

HELP repayments: 2025-26 and 2026-27
Rule2025-262026-27Change
Repayments start at$67,000$69,528+$2,528
Band 1: starts at$67,000$69,528+$2,528
Band 1: ends at$125,000$129,717+$4,717
Band 2: starts at$125,000$129,717+$4,717
Band 2: ends at$179,285$186,050+$6,765
Band 2: amount owed at its start$8,700$9,028+$328
Flat rate on all income above$179,285$186,050+$6,765
Band 1: rate on income above its start15%15%No change
Band 1: amount owed at its start$0$0No change
Band 2: rate on income above its start17%17%No change
Flat rate on all income10%10%No change

Income tax, foreign residents

Income tax, foreign residents: 2025-26 and 2026-27
Rule2025-262026-27Change
First bracket: ends at$135,000$135,000No change
First bracket: rate30%30%No change
Second bracket: ends at$190,000$190,000No change
Second bracket: rate37%37%No change
Third bracket: rate45%45%No change

Income tax, working holiday makers

Income tax, working holiday makers: 2025-26 and 2026-27
Rule2025-262026-27Change
First bracket: ends at$45,000$45,000No change
First bracket: rate15%15%No change
Second bracket: ends at$135,000$135,000No change
Second bracket: rate30%30%No change
Third bracket: ends at$190,000$190,000No change
Third bracket: rate37%37%No change
Fourth bracket: rate45%45%No change

Low income tax offset

Low income tax offset: 2025-26 and 2026-27
Rule2025-262026-27Change
Largest offset$700$700No change
Offset starts to reduce at$37,500$37,500No change
First reduction ends at$45,000$45,000No change
First reduction, per dollar5%5%No change
Second reduction starts at$45,000$45,000No change
Offset runs out at$66,667$66,667No change
Second reduction, per dollar1.5%1.5%No change

Medicare levy

Medicare levy: 2025-26 and 2026-27
Rule2025-262026-27Change
Medicare levy2%2%No change
No levy up to (singles)$28,011$28,011No change
Full levy from (singles)$35,013$35,013No change
Phase-in rate above the lower threshold10%10%No change

Superannuation

Superannuation: 2025-26 and 2026-27
Rule2025-262026-27Change
Super guarantee, paid by your employer12%12%No change

Take-home pay under both years' rules

Annual take-home pay at each salary, worked out by the take-home pay calculator's own engine under the 2025-26 rules and the 2026-27 rules, with the calculator's opening assumptions for everything else.

Resident with private hospital cover

Take-home pay, Resident with private hospital cover, 2025-26 and 2026-27
Salary2025-26 take-home2026-27 take-homeChange a year
$30,000$28,613.10$28,731.10+$118.00
$45,000$40,137.00$40,405.00+$268.00
$60,000$50,112.00$50,380.00+$268.00
$75,000$60,212.00$60,480.00+$268.00
$90,000$70,412.00$70,680.00+$268.00
$120,000$90,812.00$91,080.00+$268.00
$150,000$110,162.00$110,430.00+$268.00
$200,000$139,862.00$140,130.00+$268.00

Resident without private hospital cover

Take-home pay, Resident without private hospital cover, 2025-26 and 2026-27
Salary2025-26 take-home2026-27 take-homeChange a year
$30,000$28,613.10$28,731.10+$118.00
$45,000$40,137.00$40,405.00+$268.00
$60,000$50,112.00$50,380.00+$268.00
$75,000$60,212.00$60,480.00+$268.00
$90,000$70,412.00$70,680.00+$268.00
$120,000$89,312.00$89,880.00+$568.00
$150,000$108,287.00$108,555.00+$268.00
$200,000$136,862.00$137,130.00+$268.00

Resident with cover, repaying a HELP debt

Take-home pay, Resident with cover, repaying a HELP debt, 2025-26 and 2026-27
Salary2025-26 take-home2026-27 take-homeChange a year
$30,000$28,613.10$28,731.10+$118.00
$45,000$40,137.00$40,405.00+$268.00
$60,000$50,112.00$50,380.00+$268.00
$75,000$59,012.00$59,659.20+$647.20
$90,000$66,962.00$67,609.20+$647.20
$120,000$82,862.00$83,509.20+$647.20
$150,000$97,212.00$97,953.89+$741.89
$200,000$119,862.00$120,130.00+$268.00

Work out your own figure: take-home pay on 2026-27 rules or on 2025-26 rules.

Data sources

Both years' rules are read from datasets that record where each figure came from and when it applies. 2026-27 took effect on 1 July 2026.

  1. Australia: individual income tax, Medicare levy, LITO, HELP and superannuation, 2026-27

    ATO, Tax rates for Australian residents; ATO, Medicare levy reduction for low-income earners; ATO, Medicare levy surcharge income thresholds and rates; ATO, Study and training support loans rates and repayment thresholds; ATO, Super guarantee percentage; ATO: income tests, including reportable super contributions in MLS and HELP repayment income.

    Effective 1 July 2026 to 30 June 2027. Retrieved 29 August 2026. Within its effective period.

    Financial year 2026-27, in which the second marginal rate falls from 16% to 15%. Covers resident, foreign-resident and working-holiday-maker scales, the Medicare levy with its low-income phase-in, the Medicare levy surcharge for people without private hospital cover, the low income tax offset and compulsory HELP repayments. Medicare levy family thresholds, SAPTO, Division 293 and offsets other than LITO are not modelled; superannuation is reported separately because it is paid on top of salary rather than deducted from it.

  2. Australia: individual income tax, Medicare levy, LITO, HELP and superannuation, 2025-26

    ATO, Tax rates for Australian residents; ATO, Medicare levy reduction for low-income earners; ATO, Medicare levy surcharge income thresholds and rates; ATO, Study and training support loans rates and repayment thresholds; ATO, Super guarantee percentage.

    Effective 1 July 2025 to 30 June 2026. Retrieved 19 October 2026. Past its effective period.

    Financial year 2025-26, the second year of the 16% rate on income from 18,201 to 45,000 dollars, and the first year of the marginal HELP repayment system, which starts at 67,000 dollars. The Medicare levy low-income thresholds of 28,011 and 35,013 dollars are the 2025-26 figures as raised in the 2026 Budget. Covers resident, foreign-resident and working-holiday-maker scales, the Medicare levy surcharge, the low income tax offset and compulsory HELP repayments. Medicare levy family thresholds, SAPTO, Division 293 and offsets other than LITO are not modelled; superannuation is reported separately because it is paid on top of salary.

    How we checked these figures

    Rates, the Medicare levy surcharge tiers (101,000, 118,000 and 158,000 dollars for singles) and the HELP bands (15% above 67,000, 8,700 dollars plus 17% above 125,000, 10% of all income from 179,286) are the ATO's 2025-26 tables.