PAYG Calculator: What It Does and Doesn’t Do
PAYG (pay as you go) withholding is the tax your employer takes out of each pay and sends to the ATO for you. This PAYG calculator and tax withholding estimator works out that per-pay amount for any weekly, fortnightly or monthly wage, using the same Schedule 1 formulas the ATO publishes. It then compares a full year of those pays with the tax you’ll actually owe, so you can see whether you’re heading for a refund or a bill.
It is an estimate of withholding, not your tax return. Want the amount for one fixed pay straight from a printed table? Use the weekly, fortnightly or monthly tax table. Want your take-home after tax, super and levies on an annual salary? Use the pay calculator.
How Tax Withheld Is Calculated
Employers don’t take your salary and apply the tax brackets. They use the ATO’s Schedule 1 formulas (NAT 1004), which are what the printed tax tables come from:
- Convert to a weekly figure. Weekly pay: ignore cents and add 99c. Fortnightly: halve it first. Monthly: multiply by 3 and divide by 13, then ignore cents and add 99c.
- Pick the scale. Tax-free threshold claimed, not claimed, foreign resident, or no TFN (47% flat).
- Apply the formula y = a × x − b, where a and b depend on the earnings band. For example, with the threshold claimed and weekly earnings from $362 to under $538, a = 0.15 and b = 54.3462.
- Round to the dollar and convert back to your pay period.
- Add the study loan amount from Schedule 8 if you have a HELP or other study and training loan.
On $1,000 a week with the threshold claimed that gives $138. The amounts include the 2% Medicare levy, and they build in part of the low income tax offset: with the threshold claimed, nothing is withheld until you earn more than $363 a week.
Tax Withheld vs the Tax You Owe
Withholding is a pre-payment. At the end of the year the ATO works out your real tax on your total taxable income and credits everything that was withheld. For someone paid the same amount every fortnight all year, with the threshold claimed, no deductions and no other income:
| Fortnightly pay | Withheld per fortnight | Withheld in a year | 2026-27 tax + Medicare | Refund (bill) |
|---|---|---|---|---|
| $1,000 ($26,000/yr) | $42 | $1,092 | $470 | $622 |
| $1,500 ($39,000/yr) | $148 | $3,848 | $3,275 | $573 |
| $2,000 ($52,000/yr) | $276 | $7,176 | $6,940 | $236 |
| $2,500 ($65,000/yr) | $438 | $11,388 | $11,295 | $93 |
| $3,000 ($78,000/yr) | $598 | $15,548 | $15,480 | $68 |
| $3,500 ($91,000/yr) | $758 | $19,708 | $19,640 | $68 |
| $4,000 ($104,000/yr) | $918 | $23,868 | $23,800 | $68 |
| $5,000 ($130,000/yr) | $1,238 | $32,188 | $32,120 | $68 |
| $6,000 ($156,000/yr) | $1,614 | $41,964 | $41,910 | $54 |
| $8,000 ($208,000/yr) | $2,450 | $63,700 | $63,630 | $70 |
The small differences come from rounding and from how the ATO’s formulas approximate the annual scale, including building in only part of LITO at lower incomes. The things that turn a small difference into a large refund or bill are usually outside the formula:
- Deductions reduce your taxable income but not your withholding, so they usually mean a refund. See the tax deductions guide.
- Two jobs. The second employer withholds at the no-threshold rate but can’t see your total income, so the combined result can go either way. Check it with the second job tax calculator.
- Claiming the threshold twice means too little is withheld and a bill at tax time. See tax-free threshold.
- Income without withholding (interest, rent, ABN work) adds tax that nobody withheld.
- Irregular pay: withholding on a large one-off pay is based on that pay, not your annual income. Bonuses and back pay use Schedule 5.
To estimate last year’s return rather than this year’s withholding, use the tax return calculator.
Full ATO Tax Tables
This calculator gives one pay at a time. For every amount in a table, the same Schedule 1 formulas are printed as:
Tax Withheld FAQ
A PAYG calculator estimates the pay-as-you-go tax your employer withholds from each pay, using the ATO's published withholding formulas. This one also compares a year of withholding with the tax you'll owe, so you can see a likely refund or bill. It's an estimate: your actual tax is set when you lodge your return.
$138 if you've claimed the tax-free threshold, leaving $862. Without the threshold (a second job) it's $249. These are the ATO's Schedule 1 amounts for payments from 1 July 2026, and they include the 2% Medicare levy.
Tax withheld is the income tax your employer takes out of each pay and sends to the ATO on your behalf. It appears on your payslip as PAYG withholding or tax, and the year-to-date total is reported on your income statement. It is a payment towards your tax bill, not the final amount you owe.
Your employer converts your pay to a weekly amount (ignoring cents and adding 99c), applies the ATO's Schedule 1 formula for your scale (y = a × x − b), rounds to the nearest dollar, then converts back to your pay period. The scale depends on whether you claimed the tax-free threshold, are a foreign resident, or didn't give a TFN. A study loan adds a separate Schedule 8 amount.
Possibly. Withholding is an estimate paid in advance; your actual tax is worked out when you lodge. If you're paid the same all year with the threshold claimed, withholding usually comes out close to your tax, often a little over. On $2,000 a fortnight, $7,176 is withheld over the year against about $6,940 of tax and Medicare levy. Deductions make a refund more likely; a second job or other income without tax withheld makes a bill more likely.
With the tax-free threshold claimed, tax isn't withheld until you earn more than $363 a week, $726 a fortnight or $1,573 a month. If tax is being taken from pays below that, you probably haven't claimed the threshold with that employer, or they're using the no-TFN rate. Anything over-withheld comes back when you lodge.
It depends on your pay: nothing below the repayment threshold, then a marginal amount on the income above it. On $2,000 a fortnight with the threshold claimed the study loan component is $0. The calculator above shows your amount; the compulsory repayment itself is worked out on your full-year repayment income when you lodge.
They must withhold at 47% (45% for a foreign resident), ignoring cents. You get the excess back when you lodge, but it's a large cash-flow hit, so give your TFN declaration to your employer when you start.
No. Tax withheld is money your employer sends to the ATO on your behalf during the year. Your tax is calculated at the end of the year on your total taxable income, after deductions and offsets. The difference is your refund or your bill.
The ATO's Schedule 1 statement of formulas (NAT 1004) for payments made from 1 July 2026, and Schedule 8 for study and training loans. The weekly, fortnightly and monthly tax tables are printed from the same formulas. This calculator uses the 2026-27 coefficients.
How this calculator works▼
Per-pay withholding uses the ATO’s Schedule 1 coefficients for payments from 1 July 2026 and Schedule 8 for study and training loans; our engine reproduces the ATO’s published sample withholding amounts. The year-end figure multiplies one pay by the number of pays in a year (52, 26 or 12) and compares it with 2026-27 resident tax after the $700-maximum low income tax offset, the Medicare levy (single thresholds) and, if ticked, the compulsory study loan repayment. On $2,000 a fortnight the difference is $236.
Sources & References
- 1Schedule 1 – Statement of formulas for calculating amounts to be withheld (NAT 1004)— Australian Taxation Office
- 2Withholding amounts sample data— Australian Taxation Office
- 3Tax rates – Australian resident— Australian Taxation Office
- 4Multiple jobs or change of job (QC50527)— Australian Taxation Office
Last verified: 23 September 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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