Australia Personal Income Tax
Detailed personal income tax rates and rules for Australia in 2026.
Australia uses a Pay As You Go (PAYG) withholding system with five progressive income tax brackets for residents. The tax-free threshold is AUD 18,200, meaning the first AUD 18,200 of taxable income is not taxed. From 1 July 2026, income from AUD 18,201 to AUD 45,000 is taxed at 15% (reduced from 16%), income from AUD 45,001 to AUD 135,000 at 30%, income from AUD 135,001 to AUD 190,000 at 37%, and income exceeding AUD 190,000 at 45%. A further reduction to 14% for the second bracket is legislated for 1 July 2027. Non-residents do not receive the tax-free threshold and are taxed from the first dollar of Australian-sourced income at different rates.
| Income Range (AUD) | Tax Rate |
|---|---|
| A$0 – A$18K | 0% |
| A$18K – A$45K | 15% |
| A$45K – A$135K | 30% |
| A$135K – A$190K | 37% |
| A$190K+ | 45% |
Filing Deadline
October 31 (for individuals self-lodging; tax agent lodgements may have extended deadlines)
Residency Rule
Australia determines tax residency using a combination of tests including the resides test, the domicile test, the 183-day test, and the Commonwealth superannuation test. Australian tax residents are taxed on their worldwide income. Non-residents are generally only taxed on Australian-sourced income.
Additional Notes
In addition to income tax, most Australian taxpayers are required to pay the Medicare Levy of 2% of taxable income, which funds the public healthcare system. A Medicare Levy Surcharge of 1% to 1.5% may also apply to higher-income earners who do not hold appropriate private health insurance. Low-income earners may be eligible for a reduction or exemption from the Medicare Levy. The Low and Middle Income Tax Offset (LMITO) has expired, but the Low Income Tax Offset (LITO) of up to AUD 700 remains available for taxable incomes below AUD 66,668.
How Australia Income Tax compares
Australia’s top personal income tax rate of 45% is the 22nd highest of 203 countries TaxAtlas tracks, above the global average of 27.7% and Oceania’s regional average of 20.1%.
