Each year, the Australian Tax Office (ATO) collects income tax from Australians who are earning income according to the Australian tax brackets listed below.
The financial year in Australia starts on 1 July and ends on 30 June of the following year.
Below are the income tax brackets and rates for Australian residents. Note the rates do not include the Medicare levy of 2%.
Overview
Tax Brackets 2025 (2024-2025)
Income Tax Rates: 1 July 2024 – 30 June 2025
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 16c for each $1 over $18,200 |
| $45,001 – $135,000 | $4,288 plus 30% of amounts over $45,000 |
| $135,001 – $190,000 | $31,288 plus 37% of amounts over $135,000 |
| $190,001 and over | $51,638 plus 45% of amounts over $190,000 |
Source: ATO Individual income tax rates.
Changes
- Big changes with the reduction of the lowest tax rate from 19% to 16%.
- The 32.5% tax rate was reduced to 30% and extended up to $135k from $120k.
- The top tax bracket moved from $180k to $190k.
Tax Brackets 2024 (2023-2024)
Income Tax Rates: 1 July 2023 – 30 June 2024
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 19c for each $1 over $18,200 |
| $45,001 – $120,000 | $5,092 plus 32.5% of amounts over $45,000 |
| $120,001 – $180,000 | $29,467 plus 37% of amounts over $120,000 |
| $180,001 and over | $51,667 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates.
Changes
- The May 2023 budget had no changes to personal tax rates or thresholds.
- There was also no news about the Stage 3 tax reductions proposed by Morrison’s government. These tax cuts are currently expected to be implemented starting 1 July 2024.
Tax Brackets 2023 (2022-2023)
Income Tax Rates: 1 July 2022 – 30 June 2023
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 19c for each $1 over $18,200 |
| $45,001 – $120,000 | $5,092 plus 32.5% of amounts over $45,000 |
| $120,001 – $180,000 | $29,467 plus 37% of amounts over $120,000 |
| $180,001 and over | $51,667 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates.
Changes
- There were no tax rates or income threshold changes in both Budget Speeches in March 2022 and October 2022.
Tax Brackets 2022 (2021-2022)
Income Tax Rates: 1 July 2021 – 30 June 2022
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 19c for each $1 over $18,200 |
| $45,001 – $120,000 | $5,092 plus 32.5% of amounts over $45,000 |
| $120,001 – $180,000 | $29,467 plus 37% of amounts over $120,000 |
| $180,001 and over | $51,667 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates for prior years.
Changes
- No changes from previous year.
Tax Brackets 2021 (2020-2021)
Income Tax Rates: 1 July 2020 – 30 June 2021
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 19c for each $1 over $18,200 |
| $45,001 – $120,000 | $5,092 plus 32.5% of amounts over $45,000 |
| $120,001 – $180,000 | $29,467 plus 37% of amounts over $120,000 |
| $180,001 and over | $51,667 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates for prior years.
Changes
- Tax threshold changes:
- Increasing the 19% bracket from $37,000 to $45,000
- Increasing the 32.5% bracket from $90,000 to $120,000
- This was first announced in the 2018 Federal budget, and moved forward in the 2020 Federal Budget. Refer to the 2018 Treasury Laws Amendment legislation.
Tax Brackets 2020 (2019-2020)
Income Tax Rates: 1 July 2019 – 30 June 2020
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $37,000 | 19c for each $1 over $18,200 |
| $37,001 – $90,000 | $3,572 plus 32.5% of amounts over $37,000 |
| $90,001 – $180,000 | $20,797 plus 37% of amounts over $90,000 |
| $180,001 and over | $54,097 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates for prior years.
Changes
- No changes
Tax Brackets 2019 (2018-2019)
Income Tax Rates: 1 July 2018 – 30 June 2019
| Taxable Income | Tax on this Income |
| $0 – $18,200 | Nil |
| $18,201 – $37,000 | 19c for each $1 over $18,200 |
| $37,001 – $90,000 | $3,572 plus 32.5% of amounts over $37,000 |
| $90,001 – $180,000 | $20,797 plus 37% of amounts over $90,000 |
| $180,001 and over | $54,097 plus 45% of amounts over $180,000 |
Source: ATO Individual income tax rates for prior years.
Changes
- The 32.5% bracket increased from $87,000 to $90,000.
How Tax Brackets Work for Individuals
Australia uses a progressive tax system, which means that the rate of tax increases as the taxable income increases. Each tax bracket corresponds to a range of income and the tax rate applicable to that range.
As your income increases, you move up the tax brackets, but the higher tax rate is only applied to the amount of income within that bracket. This is known as ‘marginal tax rates’. For example, if your income for the 2023 fiscal year is $50,000, you wouldn’t pay a flat 32.5% on all your income. Instead, you’d pay 19% on the income between $18,201 and $45,000, and then 32.5% on the amount from $45,001 to $50,000.
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