ATO Tax Rates 2025–2026 Australia
Australian income tax brackets, Medicare Levy, superannuation guarantee (SG), PAYG instalments and key thresholds for the 2025–2026 financial year.
Australian Resident Income Tax Rates (2025–2026)
Australia uses a progressive income tax system where different portions of taxable income are taxed at different marginal tax rates. Higher income levels are taxed at higher rates, while lower income levels are taxed at lower rates.
| Taxable Income | Tax Rate |
|---|---|
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 16% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| $190,001+ | 45% |
These tax brackets apply to Australian residents and do not include the Medicare Levy.
Medicare Levy
Most Australian residents pay a Medicare Levy of 2% of taxable income. The Medicare Levy helps fund Australia’s public healthcare system.
Low-income earners may qualify for reductions or exemptions depending on individual circumstances.
Superannuation Guarantee (SG)
The Superannuation Guarantee (SG) is the minimum percentage of earnings that employers must contribute into an employee’s super fund.
Current SG Rate: 11%
Employers are generally required to contribute 11% of ordinary time earnings into eligible superannuation funds.
PAYG Instalments
PAYG instalments are periodic tax prepayments made throughout the year. They are commonly used by sole traders, freelancers, contractors, investors and businesses whose income is not fully covered by PAYG withholding.
PAYG instalments help spread tax obligations across the financial year and reduce the likelihood of large end-of-year tax bills.
HECS / HELP Repayment Thresholds
HECS-HELP repayment obligations are based on repayment income thresholds set by the Australian government. As income increases, repayment percentages generally increase progressively.
Thresholds may change yearly depending on legislation and indexation updates.
Why Understanding Tax Rates Matters
Understanding Australian tax rates helps individuals and businesses make better financial decisions, including:
- Salary negotiations
- Business cash flow planning
- PAYG instalment budgeting
- Superannuation planning
- Take-home pay estimation
Frequently Asked Questions (FAQ)
What are the Australian tax rates for 2025–2026?
Australia uses progressive tax brackets ranging from 0% to 45% depending on taxable income levels.
Does the Medicare Levy apply to everyone?
Most Australian residents pay the Medicare Levy, although low-income earners may qualify for reductions or exemptions.
What is the current Superannuation Guarantee rate?
The current SG rate is 11% of ordinary time earnings.
What are PAYG instalments?
PAYG instalments are periodic prepayments of income tax used by individuals and businesses.
Are these ATO tax rates official?
This page is based on publicly available Australian Taxation Office (ATO) guidelines and is intended for general informational purposes only.