Australian tax brackets 2026-27

For 2026-27, Australian residents pay no income tax on the first $18,200, 15% on $18,201 to $45,000, 30% up to $135,000, 37% up to $190,000 and 45% above $190,000. Most residents also pay the 2% Medicare levy.

Resident tax rates 2026-27
Taxable income	Rate	Tax on this income
$0 to $18,200	0%	Nil
$18,201 to $45,000	15%	15c for each $1 over $18,200
$45,001 to $135,000	30%	$4,020 plus 30c for each $1 over $45,000
$135,001 to $190,000	37%	$31,020 plus 37c for each $1 over $135,000
$190,001 and over	45%	$51,370 plus 45c for each $1 over $190,000

Find your tax bracket

Taxable income

Tax year

Residency

Marginal tax rate

30%

on your next dollar

Income tax

$16,020

before offsets and Medicare levy

Average tax rate

18.8%

of your whole income

You can earn $50,000 more before the 37% rate starts at $135,001.

Where your tax comes from

Bracket	Rate	Your income in it	Tax
$0 to $18,200	0%	$18,200	$0
$18,201 to $45,000	15%	$26,800	$4,020
$45,001 to $135,000	30%	$40,000	$12,000
$135,001 to $190,000	37%	$0	$0
$190,001 and over	45%	$0	$0

How marginal tax rates work

Each rate applies only to the slice of income inside its bracket, so moving into a higher bracket never lowers your take-home pay. Your marginal rate is the rate on your next dollar. Your average rate is your total tax divided by your income.

Example: on a $85,000 taxable income in 2026-27, the first $18,200 is tax free, the next $26,800 is taxed at 15% ($4,020), and the remaining $40,000 at 30%. Income tax is $16,020, an average rate of 18.8%. The Medicare levy adds $1,700. To see the result per pay, use the take-home pay calculator.

Tax rates for foreign residents 2026-27

Foreign residents for tax purposes get no tax-free threshold and pay no Medicare levy.

Foreign resident tax rates 2026-27
Taxable income	Rate	Tax on this income
$0 to $135,000	30%	30c for each $1
$135,001 to $190,000	37%	$40,500 plus 37c for each $1 over $135,000
$190,001 and over	45%	$60,850 plus 45c for each $1 over $190,000

Tax rates for working holiday makers 2026-27

These rates apply to income earned on a working holiday visa (subclass 417 or 462).

Working holiday maker tax rates 2026-27
Taxable income	Rate	Tax on this income
$0 to $45,000	15%	15c for each $1
$45,001 to $135,000	30%	$6,750 plus 30c for each $1 over $45,000
$135,001 to $190,000	37%	$33,750 plus 37c for each $1 over $135,000
$190,001 and over	45%	$54,100 plus 45c for each $1 over $190,000

How the resident brackets have changed

The Stage 3 changes reshaped the brackets from 1 July 2024. The 16% rate then fell to 15% from 1 July 2026, and is legislated to fall to 14% from 1 July 2027. Tax on the same income in each year:

Income tax on the same income by financial year
Taxable income	2023-24	2024-25	2025-26	2026-27
$45,000	$5,092	$4,288	$4,288	$4,020
$85,000	$18,092	$16,288	$16,288	$16,020
$135,000	$35,017	$31,288	$31,288	$31,020
$200,000	$60,667	$56,138	$56,138	$55,870

Income tax only, before offsets and the Medicare levy. To work out your refund for the year, use the tax return calculator. To compare your own income across years, use the income tax comparison calculator or the tax cut calculator.

The thresholds are not indexed to inflation. A pay rise that only keeps pace with prices can still push more of your income into a higher bracket, which is called bracket creep. The inflation calculator shows how much a past salary is worth in today's dollars.

What the brackets leave out

The Medicare levy: 2% of taxable income for most residents, reduced or nil on low incomes.
The Low Income Tax Offset: up to $700 off your tax if your taxable income is under $66,667.
The Medicare levy surcharge: 1% to 1.5% extra if you have no private hospital cover and your income is over $105,000 (single).
At the top end, Division 293 tax adds 15% on super contributions once income plus contributions passes $250,000.
HELP repayments, if you have a study loan. See the student loan calculator.

Sources: the ATO's tax rates and codes and the Treasury Laws Amendment (More Cost of Living Relief) Act 2025. Maintained by James Crawford; last updated 21 October 2026. How our calculators work.

Frequently Asked Questions

What are the Australian tax brackets for 2026-27?

For 2026-27, Australian residents pay no tax on the first $18,200, 15% on income from $18,201 to $45,000, 30% up to $135,000, 37% up to $190,000 and 45% on income over $190,000.

Do I pay my top tax rate on all of my income?

No. Each rate applies only to the part of your income inside that bracket. On a $85,000 income your marginal rate is 30%, but your income tax is $16,020, an average rate of 18.8%.

What changed in the tax brackets from 1 July 2026?

The rate on income from $18,201 to $45,000 fell from 16% to 15%. The thresholds and the other rates did not change. A further cut to 14% is legislated from 1 July 2027.

Do foreign residents get the tax-free threshold?

No. Foreign residents pay 30% from the first dollar of Australian income, and they do not pay the Medicare levy.

Is the Medicare levy part of the tax brackets?

No. The Medicare levy is a separate 2% of taxable income for most residents, added on top of income tax. So a resident in the 30% bracket usually pays 32% on their next dollar.