How much income tax should you be paying? Compare gross income versus net income.
This calculator helps you:
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Work out how much income tax you should be paying
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Calculate gross pay versus net pay - per annum, and per week
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The 2% Medicare levy
Income Tax Brackets - 2023/24 Financial Year
|
Taxable income |
Tax on this income |
|---|---|
|
0 – $18,200 |
Nil |
|
$18,201 – $45,000 |
19c for each $1 over $18,200 |
|
$45,001 – $120,000 |
$5,092 plus 32.5c for each $1 over $45,000 |
|
$120,001 – $180,000 |
$29,467 plus 37c for each $1 over $120,000 |
|
$180,001 and over |
$51,667 plus 45c for each $1 over $180,000 |
These rates do not include the 2% Medicare Levy, and are for residents of Australia.
2024-25 Income Tax Cuts Explained
From the 2024-25 financial year, income tax cuts have been legislated. The 37% tax bracket will be eliminated and there will be one large bracket for a large bulk of those earning an income between $45,000 and $180,000. This has also been reduced to 30% from 32.5%.
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$0-$18,200 - Nil
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$18,200 - $45,000 - 19%
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$45,001 - $180,000 - 30%
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$180,001 and over - 45%
Someone earning an income of $150,000 will pay $3,975 less tax than the 2023-24 financial year. Someone earning the average (mean) full-time salary of $94,000 will have $1,225 more in their pocket.
Medicare Levy and Medicare Levy Surcharge Explained
The Medicare Levy, and the Medicare Levy Surcharge (MLS), are often confused - and it’s easy to see why. Most income tax payers, barring those on low incomes, pay the standard 2% Medicare Levy as part of their paycheques.
The MLS on the other hand is a surcharge for those on higher incomes. It is an extra 1%, 1.25% or 1.5% if you earn above a certain income threshold and do not have an appropriate level of private health cover.
|
2023-24 MLS Brackets |
Single Income |
Family Income |
|---|---|---|
|
Tier 1 - 1% |
$93,001 - $108,000 |
$186,001 - $216,000 |
|
Tier 2 - 1.25% |
$108,001 - $144,000 |
$216,001 - $288,000 |
|
Tier 3 - 1.5% |
$144,000 or more |
$288,001 or more |
There are no particular MLS benefits for pooled family income, except after one child, where the threshold is raised by $1,500 for every dependent after the first.
To avoid this extra tax, you will need to take out an appropriate private health policy. However you will also need to work out what’s more cost effective - a private health policy, or paying extra tax.
