Australian income tax brackets 2026–27
Australian residents pay income tax in bands for 2026-27. The first $18,200 you earn is tax-free. Income from $18,201 to $45,000 is taxed at 15%. From $45,001 to $135,000 the rate is 30%. From $135,001 to $190,000 it is 37%. Anything above $190,000 is taxed at 45%. Marginal means each rate applies only to the income inside that band, not to your whole salary. So a higher bracket lifts the tax on your top dollars, never on the income below it. Tax owed at the band ceilings is $4,020 at $45,000, $31,020 at $135,000 and $51,370 at $190,000. These figures cover income tax only.
| Taxable income | Rate | Tax at band ceiling |
|---|---|---|
| $0 – $18,200 | Nil | $0 |
| $18,201 – $45,000 | 15% | $4,020 |
| $45,001 – $135,000 | 30% | $31,020 |
| $135,001 – $190,000 | 37% | $51,370 |
| $190,001 and over | 45% | — |
What changed
For 2026-27 the second bracket dropped from 16% to 15%. That saves up to $268 a year for anyone earning $45,000 or more. The 16% rate applied in 2025-26. The same bracket is legislated to fall again to 14% from 1 July 2027, so the tax on income between $18,201 and $45,000 keeps easing.
Compare with 2025–26
| Band | 2025–26 | 2026–27 |
|---|---|---|
| $0 – $18,200 | Nil | Nil |
| $18,201 – $45,000 | 16% | 15% |
| $45,001 – $135,000 | 30% | 30% |
| $135,001 – $190,000 | 37% | 37% |
| $190,001 and over | 45% | 45% |
Other years
See what these rates mean for your pay: try the take-home calculator or jump straight to a salary, e.g. $70,000, $85,000, $100,000.
Frequently asked
- What are the 2026-27 resident tax brackets?
- Income up to $18,200 is tax-free. From $18,201 to $45,000 the rate is 15%, then 30% to $135,000, 37% to $190,000, and 45% above $190,000. Each rate applies only to income within its band.
- Do these brackets include the Medicare levy?
- No. The brackets cover income tax only. The Medicare levy of 2% of taxable income is worked out separately and added on top. HECS/HELP repayments are separate again.
- When did the new rates start?
- The 2026-27 rates apply from 1 July 2026. The second bracket fell from 16% to 15% on that date. Rates hold until the next financial year.
- What changes next year?
- From 1 July 2027 the second bracket is legislated to drop again, from 15% to 14%. That reduces the tax on income between $18,201 and $45,000.