Marginal rate, average rate, and bracket breakdown.
Total tax (incl Medicare levy)
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Tax by bracket
Your breakdown
Updates live as you type| Band | Rate | Tax |
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Worked example
Take a resident on $95,000 of taxable income in 2026-27. The first $18,200 is tax-free. The slice from $18,201 to $45,000 is taxed at 16 percent, giving $4,288. The slice from $45,001 to $95,000 is taxed at 30 percent, giving $15,000. That makes income tax $19,288 before the levy. The 2 percent Medicare Levy on the full $95,000 adds $1,900, for a total of $21,188. The top dollar falls in the 30 percent band, so the marginal rate is 30 percent, but the average rate is only $21,188 divided by $95,000, about 22.3 percent. The average is lower than the marginal rate because the tax-free threshold and the 16 percent band pull the overall burden down.
How it is calculated
The calculator applies the 2026-27 resident Stage 3 brackets one band at a time. Each slice of income is taxed only at its own band rate, so moving into a higher bracket never taxes your whole income at the higher rate, only the part inside that band. It sums the tax from every band to get your income tax, then adds the 2 percent Medicare Levy on income above the low-income threshold. Your marginal rate is the rate of the highest band your income reaches, which is what a pay rise or an extra dollar of income is taxed at. Your average rate is total tax divided by total income, and it is always lower than the marginal rate because of the tax-free threshold and the lower bands beneath your top one.