How we calculate your pay

Every number in our calculator comes from a published Australian Taxation Office (ATO) source. This page documents exactly which file each rate came from and when we last reviewed the figures. If you spot a discrepancy between our output and your payslip, please let us know.

Last reviewed 2026-08-19.

1. The pipeline

1. Convert to annual. Hourly, daily, weekly, fortnightly and monthly figures are converted to an annual amount using 38 hours/week and 52 weeks/year by default (you can change this).
2. Strip super if "Total Employment Cost". If your offer includes super in the headline figure, we peel it off the top before taxing.
3. Subtract pre-tax salary sacrifice. Anything you salary sacrifice (super, novated lease) reduces your taxable income.
4. Apply income tax brackets. The progressive ATO brackets for the selected financial year are applied to your taxable income.
5. Subtract the Low Income Tax Offset (LITO) if you are an Australian resident for tax purposes.
6. Add the Medicare levy at 2% (with the low-income shade-in if applicable). Non-residents and working holiday makers are not liable.
7. Add the HECS-HELP repayment if you have a study debt and your repayment income exceeds the threshold.
8. Subtract post-tax deductions (union fees, salary-packaged benefits) and divide the result back to the requested pay period.
9. Show superannuation as a separate line — it is paid on top of salary, not deducted from take-home pay.

2. Income tax brackets (Australian residents)

Source: Tax rates – Australian residents.

FY 2026–27 (current)

The 15% second-bracket rate took effect on 1 July 2026 under the Treasury Laws Amendment (More Cost of Living Relief) Act 2025. A further reduction to 14% is scheduled for 1 July 2027.

3. Medicare levy

Source: Medicare levy.

The Medicare levy is 2% of taxable income for Australian residents with no exemption. A low-income threshold means no levy is payable below that income (around $28,011 for singles in FY 2025–26), and a "shade-in" band between the lower and upper thresholds applies a 10% rate to the excess over the lower threshold. Foreign residents are not liable.

4. LITO

Source: Low income tax offset (LITO).

The Low Income Tax Offset provides up to $700 of offset. It phases in fully up to a taxable income of $37,500, reduces by 5c per dollar between $37,500 and $45,000, and by 1.5c per dollar between $45,000 and $66,667. Non-residents are not eligible.

5. HECS-HELP / VSL / TSL / SSL / SFSS

Source: Repaying your study loan.

Compulsory repayments are calculated on "repayment income" (taxable income plus reportable fringe benefits plus reportable employer super contributions). The current marginal schedule ranges from 1% at the lower threshold up to 10% above $200,000. Salaried employees with HECS debt have the repayment withheld by their employer. The MVP treats repayment income as taxable income for simplicity; turn on the salary-sacrifice toggle if you make pre-tax super contributions (which reduce your repayment income).

6. Superannuation

Source: Superannuation guarantee.

The Superannuation Guarantee is the minimum amount your employer must contribute on top of your salary. It is 12% of ordinary time earnings from 1 July 2025 onwards. It is not deducted from your take-home pay.

7. Why this differs from PAYG withholding

Source: Schedule 1 – Statement of formulas for calculating amounts to be withheld (NAT 1004).

Employers use the formulas in ATO Schedule 1 (NAT 1004) to work out how much to withhold from each pay. These formulas use weekly-equivalent earnings and small rounding coefficients and may differ from the actual tax by a few dollars per pay. The difference is reconciled at tax time. The calculator on SalaryCalc uses the actual tax-bracket method, which represents what you will owe on the year.

8. What we don't model

• Medicare Levy Surcharge (1%–1.5% on top of the levy for high-income earners without private hospital cover).
• Private health insurance rebate.
• Reportable fringe benefits, reportable employer super contributions, net investment losses (which can shift your HELP repayment income and your MLS income).
• State payroll tax (an employer cost, not a deduction from your pay).
• The new $1,000 standard work-related deduction (a tax-time benefit, not a per-pay withholding).
• Child support, garnishee orders, and other court-ordered deductions.

For any of the above, talk to a registered tax agent or use the ATO's own calculators.