Australian Tax Brackets 2025-26
Australia uses progressive tax rates — you only pay the higher rate on income above each threshold, not on everything. These rates apply from 1 July 2025 to 30 June 2026.
Resident Tax Rates
| Taxable Income | Rate | Tax on This Bracket |
|---|---|---|
| $0 – $18,200 | 0% | Nil |
| $18,201 – $45,000 | 16% | $0 + 16c per $1 over $18,201 |
| $45,001 – $135,000 | 30.0% | $4,288 + 30c per $1 over $45,001 |
| $135,001 – $190,000 | 37.0% | $31,288 + 37c per $1 over $135,001 |
| $190,001+ | 45.0% | $51,638 + 45c per $1 over $190,001 |
Plus 2% Medicare Levy for most residents (exempt below $27,222). Source: ATO
Non-Resident Tax Rates
| Taxable Income | Rate |
|---|---|
| $0 – $135,000 | 30.0% |
| $135,001 – $190,000 | 37.0% |
| $190,001+ | 45.0% |
Non-residents have no tax-free threshold and do not pay Medicare Levy.
Working Holiday Maker Rates
| Taxable Income | Rate |
|---|---|
| $0 – $45,000 | 15.0% |
| $45,001 – $135,000 | 30.0% |
| $135,001 – $190,000 | 37.0% |
| $190,001+ | 45.0% |
Applies to visa subclasses 417 and 462. First $45,000 taxed at 15%.
Key Thresholds 2025-26
| Tax-free threshold | $18,200 |
| Medicare Levy exempt | ≤ $27,222 |
| Medicare Levy full (2%) | ≥ $34,027 |
| MLS Tier 1 (1%) | > $101,000 |
| MLS Tier 2 (1.25%) | > $118,000 |
| MLS Tier 3 (1.5%) | > $158,000 |
| HECS repayment starts | $67,000 |
| Super guarantee rate | 12% |
| Concessional super cap | $30,000 |
| Division 293 threshold | $250,000 |
Super Guarantee by Year
| Financial Year | SG Rate | Concessional Cap |
|---|---|---|
| 2025-26 | 12.0% | $30,000 |
| 2024-25 | 11.5% | $30,000 |
| 2023-24 | 11.0% | $27,500 |
| 2022-23 | 10.5% | $27,500 |
| 2021-22 | 10.0% | $27,500 |
Frequently Asked Questions
How do progressive tax brackets work?
You only pay the higher rate on income above each threshold. For example, a resident earning $60,000 pays 0% on the first $18,200, 16% on $18,201–$45,000, and 30% on $45,001–$60,000.
What changed with Stage 3 tax cuts?
From 1 July 2024, the 19% rate dropped to 16%, the 32.5% rate dropped to 30%, and the $120K bracket threshold rose to $135K. Most workers pay less tax.
Do I pay Medicare Levy on top of income tax?
Yes. Most residents pay an additional 2% Medicare Levy. Low earners (under $27,222 for 2025-26) are exempt, with a phase-in zone up to $34,027.
When do HECS repayments start?
For 2025-26, compulsory repayments begin when your income exceeds $67,000. The system changed to marginal rates — you only pay the repayment percentage on income above each threshold.
What is the super guarantee rate for 2025-26?
12%. Your employer pays this on top of your salary. It's taxed at 15% inside your super fund.
Are non-residents taxed differently?
Yes. Non-residents have no tax-free threshold — the first dollar is taxed at 30% (2025-26). They also don't pay Medicare Levy.
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