How it's calculated
Your take-home pay is your gross pay minus the PAYG tax your employer withholds, and minus any study loan repayment. The calculator uses the ATO's withholding formulas for the 2026–27 income year (1 July 2026 to 30 June 2027), which the Commissioner of Taxation registers each year as a legislative instrument.Australian Taxation Office
- PAYG withholding. Schedule 1 turns each pay into a weekly figure and applies a straight-line formula, y = ax − b, from a table of coefficients. If you claim the tax-free threshold (scale 2), the formula already allows for the $18,200 tax-free threshold, the low income tax offset and the 2% Medicare levy. A second job without the threshold uses scale 1, and foreign residents use scale 3.
- 2026–27 tax rates. Resident rates are nil to $18,200, then 15% to $45,000 (down from 16% last year), 30% to $135,000, 37% to $190,000 and 45% above.Federal Register of Legislation
- Study loans. If you have a HELP, VSL, SSL, AASL or Financial Supplement debt, your employer adds the Schedule 8 component, which starts once your annual pay passes the $69,528 repayment threshold.
- Super. Your employer pays 12% super guarantee on top of your salary. From 1 July 2026 it is paid on each payday, on your qualifying earnings including any salary you sacrifice, up to the $270,830 maximum contributions base.Federal Register of Legislation
The formula
- Pay per period = (salary − salary sacrifice) ÷ 52, 26 or 12. If your salary includes super, the base salary is the package ÷ 1.12 (up to the maximum contributions base).
- Weekly earnings x = whole dollars of the weekly equivalent + 99 cents. Fortnightly pay is halved; monthly pay is multiplied by 3 and divided by 13.
- Weekly withholding = a × x − b, using the row of the scale that x falls in, rounded to the nearest dollar.
- Withholding per pay = weekly amount × 2 (fortnightly), or × 13 ÷ 3 rounded to the dollar (monthly).
- Study loan component = the same steps with the Schedule 8 coefficients.
- Take-home = pay − withholding − study loan component.
The year-end estimate then works out your actual tax for 2026–27: income tax on taxable income, less the low income tax offset, plus the Medicare levy, any Medicare levy surcharge and the compulsory study loan repayment. It includes the new $1,000 standard deduction for work-related expenses.Federal Register of Legislation
Worked example
On a $90,000 salary paid fortnightly, with the tax-free threshold claimed and no study loan, take-home pay is $2,718 a fortnight after $744 of PAYG tax. Your employer also pays $10,800 a year into your super fund.
| Line | Per fortnight | Per year |
|---|---|---|
| Gross pay | $3,462 | $90,000 |
| PAYG tax (incl. Medicare levy) | $744 | $19,344 |
| Take-home pay | $2,718 | $70,656 |
| Employer super guarantee (12%), paid to your fund | $415 | $10,800 |
With a HELP debt the same salary takes home $2,600 a fortnight, because $118 goes towards the loan. A $120,000 package that includes super, paid monthly, gives $6,858 a month.
| Line | Per month | Per year |
|---|---|---|
| Gross pay | $8,929 | $107,143 |
| PAYG tax (incl. Medicare levy) | $2,071 | $24,852 |
| Take-home pay | $6,858 | $82,291 |
| Employer super guarantee (12%), paid to your fund | $1,071 | $12,857 |
Assumptions and limitations
- One job, the same pay all year. Overtime, bonuses and allowances change individual pays. If you have two jobs, claim the tax-free threshold from only one.
- Withholding is not your final tax. The ATO tables are built to come close to your tax bill, and the year-end table shows the expected refund or shortfall. Deductions, other income and offsets you claim in your return change it.
- Medicare levy adjustments for a spouse or children (claimed on a Medicare levy variation declaration) and the Medicare levy surcharge are not withheld here; the surcharge appears in the year-end estimate.
- Working holiday makers are withheld at 15% until their total pay for the year passes $45,000, then 30%; the per-pay figure is the year's average.
- Not included: salary packaging of fringe benefits, the seniors and pensioners tax offset, zone and other offsets claimed through a withholding declaration, and the extra withholding some people choose in a year with 27 fortnightly pays.