Tax Brackets
The income ranges that determine the rate of tax applied to each portion of your taxable income.
Tax brackets (also called tax scales) define the progressive rate structure used to calculate individual income tax in Australia. Each bracket specifies an income range and the tax rate that applies to income within that range. For 2025–26, the brackets are: $0–$18,200 at 0%, $18,201–$45,000 at 16%, $45,001–$135,000 at 30%, $135,001–$190,000 at 37%, and $190,001+ at 45%.
The Stage 3 tax cuts, which took effect from 1 July 2024, significantly reshaped these brackets. The 19% bracket was reduced to 16%, the 32.5% bracket was reduced to 30%, and the $120,000 threshold was raised to $135,000. These changes provided a tax cut to every taxpayer earning above $18,200, with the largest absolute benefit going to those earning between $135,000 and $190,000.
Foreign residents (non-residents for tax purposes) have different brackets with no tax-free threshold — they pay 30% from the first dollar up to $135,000, then 37% to $190,000, and 45% above $190,000. Working holiday makers (visa subclass 417 and 462) also have a special rate of 15% on the first $45,000.