Income Tax Comparison Calculator

Comparing income tax across financial years helps you understand how changes to tax brackets, the Low Income Tax Offset (LITO), and other tax policies affect your take-home pay. This is particularly relevant with the Stage 3 tax cuts that took effect from 1 July 2024, which significantly changed the tax brackets for most Australian taxpayers.

The revised Stage 3 tax cuts reduced the 19% tax rate to 16%, lowered the 32.5% rate to 30%, and raised the threshold for the 37% rate from $120,000 to $135,000. The 45% rate threshold was also raised from $180,000 to $190,000. These changes benefit low and middle-income earners more than the original Stage 3 plan.

Yes. From 1 July 2026 the rate on income between $18,201 and $45,000 drops from 16% to 15%, saving up to $268 a year. The other brackets are unchanged from 2024-25 and 2025-26. The comparison calculator uses the published ATO tax rates for each financial year so you can see exactly how your tax liability changes year over year.

Yes, the comparison includes the 2% Medicare Levy for each financial year. The Medicare Levy is calculated on your taxable income and is included in the total tax figure. The calculator also accounts for the Medicare Levy low-income threshold, which may exempt or reduce the levy for lower-income earners.

The effective tax rate is your total tax (including income tax, minus offsets like LITO, plus Medicare Levy) divided by your gross income, expressed as a percentage. It represents the average rate of tax you pay on every dollar earned, which is typically much lower than your marginal tax rate.