Bonus · Calculator

Bonus Tax Calculator Australia 2026-27

Compare the estimated annual tax effect of your bonus with ATO Schedule 5 Method A withholding. The result includes LITO and the individual Medicare low-income reduction.

Schedule 5 Method ALITO + MedicareWithholding Comparison

What this shows: your estimated annual tax increase, after-tax bonus and Schedule 5 Method A withholding. It does not promise a refund because your final return includes the rest of your tax position. Also see: Pay Calculator, how withholding is reconciled, salary sacrifice a bonus?

01 —INPUTS

Tax year

Sets both the annual tax rules and ATO PAYG coefficients.

Try a common bonus scenario

Annual Salary (before bonus)

Your base annual salary excluding the bonus

Bonus Amount

The gross bonus you received (or expect)

Pay Frequency

How often you're paid (affects withholding estimate)

02 —RESULTS

Awaiting input

Enter your salary and bonus to see how it's taxed

Next best steps

Understand the withholding gapSee how bonus withholding is reconciled on the final tax return Compare salary sacrificeCheck when redirecting a bonus to super may change the outcome Model total take-home payMove from the one-off bonus to the full salary and pay picture Estimate the final return outcomeCombine annual income, withholding and deductions

Edit inputs ↑

What to do with your bonus

Salary sacrifice your bonus into super Pre-tax contribution can save you thousands — especially at higher marginal rates. Calculate savings → See your total tax this year Your bonus pushes your total income up. Check your overall tax position. Full tax estimate → Does this trigger a HELP repayment? A bonus can push you into a higher HELP repayment bracket. Check HELP impact → Invest the after-tax amount Project how your bonus grows over time with compound returns. Growth projection →

FAQ

Why can bonus withholding differ from the final tax?

Employers can use ATO Schedule 5 Method A or Method B. Method A spreads a whole-year or undefined-period bonus across the year's pay periods before comparing withholding. Your tax return instead reconciles all annual income, deductions, offsets, levies and amounts already withheld.

Are bonuses taxed differently from regular income in Australia?

No. The ATO does not have a special bonus tax rate. Bonuses are added to your annual taxable income and taxed at your marginal rate, the same as any other income.

Will extra bonus withholding come back as a refund?

Only if your total withholding and credits exceed your final tax liability after all income, deductions, offsets, levies and study-loan repayments are included. A bonus withholding difference alone cannot guarantee a refund.

Can I salary sacrifice a bonus in Australia?

Yes. If you salary sacrifice part of your bonus into super before it's paid, that amount is taxed at only 15% instead of your marginal rate. This is subject to the $32,500 annual concessional contributions cap for 2026-27.

How is a bonus taxed in Australia?

Bonuses are taxed as part of your regular income at your marginal tax rate. Your employer withholds PAYG tax using ATO Schedule 5 (lump sum) rates, which may differ from your actual marginal rate. You reconcile the difference in your tax return.

Are bonuses taxed differently from regular income in Australia?

No. The ATO does not have a special bonus tax rate. Bonuses are added to your annual taxable income and taxed at your marginal rate, the same as any other income. The confusion arises because the employer's PAYG withholding method can make it look like a higher rate was applied.

Why does my bonus seem taxed at 47%?

47% is the Schedule 5 maximum withholding limit for an additional payment under Method A or Method B(ii), not a separate final bonus tax rate. Your final liability is based on your complete annual tax position, and the withholding may be above or below the bonus's eventual annual tax effect.

How does employer withholding work on bonuses?

Employers use ATO Schedule 5. For a whole-year or undefined-period bonus, Method A divides the bonus across the standard 52, 26 or 12 annual pay periods, compares ordinary withholding before and after that averaged amount, then multiplies the difference back up. Method B(ii) can use average year-to-date earnings and prior additional payments for a closer estimate.

Will I get the over-withheld tax back?

Only if your total withholding and credits exceed your final liability after all income, deductions, offsets, levies and study-loan repayments are included. A positive bonus-withholding difference by itself does not guarantee a refund.

Does the bonus push me into a higher tax bracket?

It can, but only the portion of income in the higher bracket is taxed at that rate. Australia uses a progressive tax system, so moving into a higher bracket doesn't mean all your income is taxed at the higher rate — only the amount above the bracket threshold.

Can I salary sacrifice my bonus to reduce tax?

Yes, if your employer allows it, you can sacrifice some or all of your bonus into super before tax. This is taxed at 15% in super rather than your marginal rate (up to 45%). Check the $32,500 concessional cap for 2026-27.

Does my bonus affect my HELP/HECS repayment?

Yes. Your bonus is included in your HELP repayment income. A bonus can push your total income above the HELP threshold ($69,528 for 2026-27) or into a higher repayment bracket, resulting in additional compulsory repayments.

Leaving your job?

Leaving your job? Calculate every payment

Bonuses are often paid alongside redundancy or termination. Calculate the tax on each component separately.

Redundancy & ETP Calculator Tax-free limits, ETP caps, and preservation age rules Lump Sum Tax Calculator Arrears, back pay, and lump sum payment tax Genuine Redundancy vs ETP Guide Which tax treatment applies to your termination payment? How Unused Leave Is Taxed Annual leave, long service leave, and sick leave on redundancy

Common bonus amounts

See worked examples for popular bonus amounts:

$1,000 bonus $2,000 bonus $3,000 bonus $5,000 bonus $8,000 bonus $10,000 bonus $15,000 bonus $20,000 bonus $25,000 bonus $50,000 bonus

The bonus tax myth

Bonus tax and withholding are different calculations

The ATO does not have a separate tax rate for bonuses. Your bonus is simply added to your annual income and taxed at your marginal rate. The confusion comes from employer withholding.

How Schedule 5 Method A works

For a bonus relating to the whole year or an undefined period, Method A uses these steps:

Step 1 Work out ordinary withholding on the normal pay-period earnings

Step 2 Divide the bonus by 52, 26 or 12 and add that average to normal earnings

Step 3 Compare ordinary withholding before and after adding the averaged bonus

Step 4 Multiply the difference back across the year, capped at 47% of the bonus

Worked example — $90k salary + $10k bonus, monthly (2026-27)

Actual tax on bonus: $3,200 (32% marginal rate incl. Medicare)
Schedule 5 Method A withholding: $3,228
Difference: $28 above this simplified annual estimate

How marginal rates apply to your bonus

Only the portion of income in a higher bracket is taxed at that rate — not all your income.

Income Range	Tax Rate	Including Medicare
$0 – $18,200	0%	Medicare may be nil or shaded in separately
$18,201 – $45,000	15%	Plus 0–2% Medicare where applicable
$45,001 – $135,000	30%	Plus up to 2% Medicare
$135,001 – $190,000	37%	Plus up to 2% Medicare
$190,001+	45%	Plus up to 2% Medicare

Ways to reduce tax on your bonus

Salary sacrifice to super Ask your employer to redirect part of the bonus into super before tax — taxed at 15% instead of your marginal rate, subject to the $32,500 concessional cap.

Claim deductions Increasing deductions reduces taxable income and may offset the bonus tax. See the WFH Deductions Calculator.

Timing If you have flexibility on when the bonus is paid, receiving it in a lower-income year means a lower marginal rate applies.

Tax tip: A withholding comparison is not a refund forecast. Use your year-to-date withholding and complete tax position when estimating a refund or bill. To model salary sacrifice savings, use the Salary Sacrifice Calculator.

Popular salary breakdowns:

$75k salary $100k salary $150k salary $200k salary $300k salary

Tax Accuracy & Sources

Reviewed: March 2026 · Tax year: 2026-27

Estimates the annual tax effect of a bonus for 2025-26 or 2026-27, including LITO and the individual Medicare low-income reduction, then compares it with Schedule 5 Method A withholding for a whole-year or undefined-period bonus. Assumes the tax-free threshold is claimed and excludes HELP, MLS, family Medicare adjustments, other offsets, deductions and other income.