Tax Cut Calculator
This tax cut calculator shows what the new tax cuts are worth on your income, per year, fortnight and week. The 16% rate on income from $18,201 to $45,000 fell to 15% on 1 July 2026 and falls to 14% on 1 July 2027, when a $250 Working Australians tax offset also starts. Both are law.
- 2025-26: 16% on $18,201 to $45,000
- 2026-27: 15% on the same band
- 2027-28: 14%, plus the $250 Working Australians tax offset
| Saving against 2025-26 | Year | Fortnight | Week |
|---|---|---|---|
| 2026-27 (15% rate) | $268 | $10.31 | $5.15 |
| 2027-28 (14% rate and WATO) | $786 | $30.23 | $15.12 |
| Income tax on $70,000 | Amount |
|---|---|
| 2025-26, after offsets, before the Medicare levy | $11,788 |
| 2026-27, after offsets, before the Medicare levy | $11,520 |
| 2027-28, after offsets, before the Medicare levy | $11,002 |
How much is the tax cut?
Anyone earning $45,000 or more gets the full cut: $268 in 2026-27, then $786 a year from 2027-28 ($536 from the 14% rate and $250 from the offset), both measured against 2025-26. Below $45,000 the cut is smaller, because less of your income sits in the band that changed.
| Taxable income | 2026-27 saving | 2027-28 saving | 2027-28 per fortnight |
|---|---|---|---|
| $30,000 | $118 | $486 | $18.69 |
| $45,000 | $268 | $786 | $30.23 |
| $70,000 | $268 | $786 | $30.23 |
| $100,000 | $268 | $786 | $30.23 |
| $150,000 | $268 | $786 | $30.23 |
The $250 Working Australians tax offset from 2027-28
The offset is worth up to $250 a year from the 2027-28 income year. You qualify as an Australian resident for tax purposes whose net labour income, meaning pay less work deductions, is above the tax-free threshold. It is non-refundable, so it can take your tax to nil but no further, and an unused amount is not refunded or carried forward.
With the low income tax offset, it lifts the income you can earn before paying any income tax. The calculator treats all your income as pay.
| Year | Highest income with nil income tax |
|---|---|
| 2025-26 | $22,575 |
| 2026-27 | $22,866 |
| 2027-28 | $24,985 |
When the tax cut shows up in your pay
The 2026-27 cut is already in your pay. The ATO's withholding schedules for payments from 1 July 2026 use the 15% rate, so tax withheld each week or fortnight dropped from the first pay in July. To see your own figure, use the weekly tax calculator or the PAYG calculator.
For 2027-28 the ATO has not yet published withholding tables, so the figures above are the saving on your annual tax. The amount withheld from each pay can differ by a few dollars, and the return settles it.
The $1,000 instant tax deduction
A separate measure, also law, starts in 2026-27. It lets workers cut their taxable income from work by $1,000 at tax time without keeping receipts. Treasury's example is Dean, a mechanic who claims $300 of work expenses: using the $1,000 instead saves him a further $224 a year. The calculator above does not include it, so enter your taxable income after any deduction you plan to claim.
Frequently asked questions
Do I need to do anything to get the tax cut?
Is the 14% rate from 1 July 2027 law?
Do non-residents get the tax cut?
Does the tax cut change the Medicare levy?
Sources
Each source below was retrieved on 6 October 2026 and returned a live page.
- ATO: Personal income tax: new tax cuts for every Australian taxpayer (QC104015, last updated 13 May 2026). The 15% and 14% rates and their start dates.
- ATO: Working Australians tax offset (QC107797, published 23 July 2026). Eligibility, the $250 maximum and non-refundability.
- ATO: Latest news on tax and superannuation law and policy (last updated 18 September 2026). Royal Assent on 26 June 2026 for the offset and the $1,000 instant tax deduction.
- Budget 2026-27: Cost of living. The $268 and $536 maximums, the average earner and Dean examples, and the $24,985 effective tax-free threshold.