How Australian Income Tax Works (2024–25)
Australia's income tax is federal-only — states do not levy income tax. The tax-free threshold is $18,200. The 2024–25 brackets include a significant cut from prior years following the Stage 3 tax changes. A Medicare Levy of 2% applies on top.
| Rate | Income |
|---|---|
| 0% | $0–$18,200 |
| 19% | $18,201–$45,000 |
| 32.5% | $45,001–$120,000 |
| 37% | $120,001–$180,000 |
| 45% | Over $180,000 |
- →Medicare Levy: 2% on top of income tax (reduced below ~$26,000)
- →Low Income Tax Offset (LITO): up to $700 tax reduction, phases out between $37,500 and $66,667
- →Medicare Levy Surcharge: 1–1.5% extra if income exceeds $93,000 and no private hospital cover
- →HECS-HELP: compulsory repayments of 1–10% if you have a study debt (income-dependent)
- →Superannuation: employer pays 11% on top of your salary — not deducted from your pay
- →Lodge via myTax through myGov by October 31 — most data is pre-filled automatically