Tax Brackets by Financial Year
Australia's individual income tax brackets remained stable from FY2020-21 through FY2023-24, with five brackets and a top marginal rate of 45%. The revised Stage 3 tax cuts then restructured the system from 1 July 2024, delivering lower rates and wider brackets for every taxpayer.
FY2020-21 to FY2023-24
These four years shared identical tax brackets. The only significant change during this period was the removal of the Low and Middle Income Tax Offset (LMITO) from FY2022-23 onwards, which effectively increased the tax burden for earners between $37,000 and $126,000.
| Taxable Income | Tax Rate |
|---|---|
| $0 – $18,200 | 0% |
| $18,201 – $45,000 | 19% |
| $45,001 – $120,000 | 32.5% |
| $120,001 – $180,000 | 37% |
| $180,001+ | 45% |
Excludes Medicare Levy (2%) and LMITO (available FY2020-21 & FY2021-22 only). Brackets identical for FY2020-21, FY2021-22, FY2022-23, and FY2023-24.
FY2024-25 & FY2025-26 (Revised Stage 3)
The revised Stage 3 tax cuts lowered the 19% rate to 16%, replaced the 32.5% rate with 30%, extended the middle bracket to $135,000, and raised the top threshold to $190,001. These brackets applied for FY2024-25 and FY2025-26; from 1 July 2026 the 16% rate fell again to 15%.
| Taxable Income | Tax Rate |
|---|---|
| $0 – $18,200 | 0% |
| $18,201 – $45,000 | 16% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| $190,001+ | 45% |
Excludes Medicare Levy (2%). Applies from 1 July 2024 onwards.
Year-Over-Year Master Comparison
The table below places all six financial years side by side so you can see exactly when each rate and threshold changed. The shaded columns highlight the FY2024-25 shift.
| Bracket | 20-21 | 21-22 | 22-23 | 23-24 | 24-25 | 25-26 |
|---|---|---|---|---|---|---|
| $0 – $18,200 | 0% | 0% | 0% | 0% | 0% | 0% |
| $18,201 – $45,000 | 19% | 19% | 19% | 19% | 16% | 16% |
| $45,001 – $120,000 | 32.5% | 32.5% | 32.5% | 32.5% | See below | |
| $45,001 – $135,000 | — | 30% | 30% | |||
| $120,001 – $180,000 | 37% | 37% | 37% | 37% | Replaced | |
| $135,001 – $190,000 | — | 37% | 37% | |||
| $180,001+ / $190,001+ | 45% | 45% | 45% | 45% | 45% | 45% |
Key Changes Timeline
Australia's Personal Income Tax Plan was legislated in 2018 as a three-stage reform spanning seven years. The timeline below captures the major milestones.
- FY2018-19 — Stage 1: Increased the Low Income Tax Offset (LITO) from $445 to $700 and introduced the temporary Low and Middle Income Tax Offset (LMITO) worth up to $530 (later increased to $1,500).
- FY2020-21 — Stage 2: Raised the upper limit of the 19% bracket from $37,000 to $45,000 and the 32.5% bracket from $90,000 to $120,000. These changes were brought forward from the originally planned FY2022-23.
- FY2022-23 — LMITO Removed: The temporary Low and Middle Income Tax Offset was not extended beyond FY2021-22, resulting in an effective tax increase of up to $1,500 for earners between $37,000 and $126,000.
- FY2024-25 — Revised Stage 3: The original Stage 3 plan (a flat 30% rate from $45,001 to $200,000) was replaced with the revised version: 16% for $18,201–$45,000, 30% for $45,001–$135,000, 37% for $135,001–$190,000, and 45% above $190,001. Every taxpayer earning above $18,200 received a cut.
Read the full breakdown of Stage 3 savings at every income level in our Stage 3 Tax Cuts guide.
Tax on $80,000 — Historical Comparison
To illustrate the real impact of bracket changes, the table below shows the total income tax payable on a $80,000 taxable income across each financial year. This excludes the Medicare Levy and any offsets.
| Financial Year | Tax on $80,000 | Change |
|---|---|---|
| FY2020-21 | $16,467 | — |
| FY2021-22 | $16,467 | $0 |
| FY2022-23 | $16,467 | $0 |
| FY2023-24 | $16,467 | $0 |
| FY2024-25 | $14,788 | −$1,679 |
| FY2025-26 | $14,788 | $0 |
| FY2026-27 | $14,520 | −$268 |
Excludes Medicare Levy and all offsets (LITO, LMITO). LMITO would have reduced the FY2020-21 and FY2021-22 figures by up to $1,080 at lodgement.
The Stage 3 tax cuts delivered a $1,679 annual saving at $80,000 income, and the cut to 15% from 1 July 2026 adds a further $268. Run your own calculation using the Income Tax Calculator.
For the current year's full breakdown at this and nearby salaries, including Medicare and the offsets excluded above, see Tax on $80,000 in Australia, Tax on $90,000 in Australia and Tax on $50,000 in Australia. The current, previous and legislated 2027-28 scales are also available as CSV and JSON on the Australian tax and pay data page.
Frequently Asked Questions
How this guide works▼
Tax brackets and rates on this page are sourced directly from the ATO's published individual income tax rate schedules for each financial year. Tax calculations exclude the Medicare Levy (2%) and any offsets unless explicitly noted. Stage 3 figures reflect the revised legislation passed in March 2024.
Sources & References
- 1Individual income tax rates for Australian residents— Australian Taxation Office
- 2Stage 3 Personal Income Tax Plan— Australian Treasury
- 3Low and Middle Income Tax Offset (LMITO)— Australian Taxation Office
Last verified: 9 October 2026. Our content is based on the latest information from official Australian government sources.
Anita Bell
AuthorFounder & Senior Bookkeeper
Accountancy degree (2015); certified in Xero, QuickBooks Online, MYOB, Saasu, Zoho and Reckon One
Anita Bell earned her accountancy degree in 2015 and has worked as a senior bookkeeper with Prime Bookkeeping for over 5 years. This built her skills in Australian and New Zealand tax legislation and industry regulations. She is certified in Xero, QuickBooks Online, MYOB, Saasu, Zoho and Reckon One, and works with payroll and rostering software including Gusto, Deputy, Tsheets and KeyPay. She has strong experience in hospitality, building and construction, financial services, real estate, ecommerce, and medical and health services.
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