Australian income tax rates for 2015/2016 and 2016/2017 years

The Australian income tax rates applicable for the 2016/2017 financial year, and the 2015/2016 and 2014/2015 financial years are set out in the tax tables below (lists the tax brackets and individual tax rates). We have also included the tax brackets and individual tax rates for the 2013/2014, 2012/2013 and 2011/2012 years at the end of the article in separate tax tables, for your reference and convenience

Note: If you’re Age Pension age or older, you may be eligible for a higher tax-free threshold by taking advantage of the Seniors & Pensioners Tax Offset (SAPTO). For more information on SAPTO, refer to the SuperGuide article No tax in retirement because you SAPTO (updated rates).

Income tax plus Medicare levy

Higher income earners are subject to an extra tax in addition to usual income tax rates. In the May 2014 Federal Budget, the government announced a temporary levy, known as the Temporary Budget Repair Levy amounting to an extra 2% of income tax for those with a taxable income of more than $180,000. The TBRL, which has applied since 1 July 2014, will apply until 30 June 2017.

The Medicare levy for all taxpayers (apart from low-income earners and seniors) is now 2%. The former ALP government increased the Medicare levy by 0.5% to fund the National Disability Insurance Scheme (for information see SuperGuide article Medicare Levy increase helps pay for NDIS). Since 1 July 2014, the Medicare levy has increased to 2%, from the previous rate of 1.5%. Lower-income earners may not pay the levy, or pay a reduced amount, while some higher-income earners may pay as much as 3.5% of their taxable income towards the Medicare levy (depending on whether they are also subject to the Medicare Surcharge Levy of up to 1.5%).

Note: The primary source for taxpayers on any information relating to tax brackets and individual tax rates is the Australian Taxation Office website (www.ato.gov.au). SuperGuide provides information on individual tax rates but this website does not answer questions specifically on the income tax rates.

Australian income tax rates for 2016/2017 and 2015/2016 years

The tax-free threshold is the first $18,200 of your income. You can earn up to $20,542 before any income tax is payable, when taking into account the Low Income Tax Offset.

For the 2015/2016 year, or for the 2014/2015 year, your top marginal rate of income tax rate can be 0%, 19%, 32.5%, 37% or 47% (plus Medicare levy).

Note: For three financial years (from 1 July 2014 until 30 June 2017), the government has introduced a Temporary Budget Repair Levy of 2% to the top marginal tax rate, increasing the top individual marginal tax rate to 47% (plus at least 2% Medicare levy). The TBRL was introduced to redress, what the government says, are debt issues for the country. The TBRL (or debt levy) applies for the 2014/2015, 2015/2016 and the 2016/2017 years, and means the top marginal tax rate is 47% plus Medicare levy.

Income tax rates for 2014/2015 year, 2015/2016 year (and 2016/2017 year)

IncomeMarginal tax rateTax payable
$0-$18,2000%Nil
$18,201- $37,00019%19 cents for each $1 over $18,200
$37,001-$80,00032.5%$3,572 plus 32.5 cents for each dollar over $37,000
$80,001-$180,00037%$17,547 plus 37 cents for each dollar over $80,000
$180,001 and above47%*$54,547 plus 47* cents for each dollar over $180,000

Source: Adapted from information on the ATO website (www.ato.gov.au). Note that Medicare Levy of 2% is also payable by most taxpayers.

*Since 1 July 2014, a debt levy of 2% is imposed on taxpayers with a taxable income greater than $180,000, and it will be imposed only on income that exceeds $180,000, taking the top marginal tax rate to 47% (plus Medicare levy). Note that the debt levy is officially known as the Temporary Budget Repair Levy.

Income tax rates for 2013/2014 and 2012/2013 financial years

Effective since the start of the 2012/2013 year, the tax-free threshold jumped to the first $18,200 of your income. You can earn up to $20,542 (effective since the 2012/2013 year) before any income tax is payable, when taking into account the Low Income Tax Offset (LITO).

For the 2013/2014 and 2012/2013 years, your top tax rate is 0%, 19%, 32.5%, 37% or 45% (plus Medicare levy).

Income tax rates for 2013/2014 and 2012/2013 financial years
IncomeMarginal tax rateTax payable
$0-$18,2000%Nil
$18,201- $37,00019%19 cents for each $1 over $18,200
$37,001-$80,00032.5%$3,572 plus 32.5 cents for each dollar over $37,000
$80,001-$180,00037%$17,547 plus 37 cents for each dollar over $80,000
$180,001 and above45%$54,547 plus 45 cents for each dollar over $180,000

Source: Adapted from information on the ATO website (www.ato.gov.au). Note that Medicare Levy of 1.5% is also payable by most taxpayers.

Income tax rates for 2011/2012 financial year

For the 2011/2012 year, a tax-free threshold on the first $6000 of your income applied, and you could earn up to $16,000 (for the 2011/2012 year) without paying income tax when taking into account the Low Income Tax Offset (LITO).

For the 2011/2012 year, your top marginal tax rate could be 0%, 15%, 30%, 37% or 45% (plus Medicare levy).

Note: For the 2011/2012 year only, a flood levy was also payable, in addition to the income tax payable (see table at the end of the article for flood levy rates applicable for your income).

Income tax rates for 2011/2012 financial year
IncomeMarginal tax rateTax payable
$0-$6,0000%Nil
$6,001- $37,00015%15 cents for each $1 over $6,000
$37,001-$80,00030%$4,650 plus 30 cents for each dollar over $37,000
$80,001-$180,00037%$17,550 plus 37 cents for each dollar over $80,000
$180,001 and above45%$54,550 plus 45 cents for each dollar over $180,000

Source: Adapted from information on the ATO website (www.ato.gov.au). Maximum LITO payable is $1500 up to taxable income of $16,000 (for 2012/2012 year).

Note: For the 2011/2012 year only, if your taxable income was more than $50,000 then your income was also subject to a flood levy. The flood levy is set out in the table below.

Taxable incomeFlood levy (for 2011/2012 year) on this income
$0 to $50,000Nil
$50,001 to $100,000Half a cent for each $1 over $50,000
Over $100,000$250 plus 1c for each $1 over $100,000

Table source: ATO (www.ato.gov.au)

Note: For the 2011/2012 year, the Medicare Levy low-income threshold was $19,404 (lower threshold) and $22,828 (upper threshold) for singles. For families, the additional amount of threshold for each dependent child or student is $3,007 (lower threshold) and $3,538 (upper threshold). For the 2011/2012 year, the Medicare Levy low-income threshold for pensioners below Age Pension age is $30,451 with an upper threshold of $35,824. For those on SATO (now known as SAPTO) it is $30,685 with an upper threshold of $36,100.

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Comments

  1. The 2013 Budget changes to the Net Medical Expenses Tax Offset should spur some action on the pre-payment front.
    If your out-of-pocket medical expenses in the 2012-13 tax year are less than $2100 you can’t claim the Net Medical Expenses Tax Offset (NMETO) in the 2012-13 tax year. The Budget changes mean that you are therefor not eligible for the NMETO in subsequent years like 2013-14 or 2014-15 even if your out of pocket expenses in those years are above the applicable threshold. However if you are eligible for the NMETO in the 2012-13 tax year you will be eligible also in subsequent years. It may therefor be in the interests of many whose operations are planned for July 2013 or later to pre-pay some or all of the medical expenses before the June 30 2013 deadline, thus establishing eligibility for the NMETO in the 2012-13 tax year.

  2. Many valued points. My partner does earn over 100 a year but let me say just cause he does doens’t mean we are rolling in it and can’t afford the extra tax hikes. Paying over 30 000 in a tax a year and then having a tax debt is ridiculous needless to say. Trying to find 4 grand and then get charged interest on that is so very hard. We don’t own a house. We are debt up to our eyeballs before he went mining. Have only done for near on two years now and im starting to think the extra money is not worth it as it gets taken in tax. So for you people who think that if we earn lots we can afford it. I can tell you that is not the case and we still live pay day to pay day. Take money off single parents is ridiculous so they can go back to work how ridiculous when not many people who work round them with skool children and then skool holidays yep ridiculous all of this is stupid

  3. Mate, what is wrong with most of you? Have a look at other countries around the world and what do you see? Most have nothing in the way of pensions or unemployment benefits. the money for everything we have has to come from somewhere. Maybe you should be thankful for what we do have and do a little less crying about the small amount of tax we do pay.

    I say pay more tax to help support more pensioners. It wouldn’t effect anyone if they lived withing there means instead of trying to keep up with the next bloke.

    • Your right Josh, this is a good country to be living in. Some people are never satisfied, and I fear they will get to the end of their lives, having not really lived it. Maybe they need to live in the slums of India or elsewhere in the world, to get a real perspective on what is important in life.

  4. Hey i asked myself the question , What did the previous goverment give the everyday
    person when in power,I myself recieved Gst, high interest rates[ which jumped was it 4times
    in the last 6mths?] high petrol on average 1.50 lt for the last yr of office, high food bills with little competition
    road tolls on roads we already owned, rises in power gas ect down to privatisation,
    work realted issues , Now i ask myself what do i have now, lower interest rates , fuel lower
    electric gas water still rising due to privatisation, carbon tax to which was promised not to be.
    Now i’m remembering one thing the previous goverment was wanting carbon tax also , howard stated he would implement it in 2013 if re elected. And abbott stated would
    probably be put onto petrol if re elected, now why is he saying he dosn’t want it ,its all about the job not the country.Stimulus was going to hurt us all ,interest rates would go through the roof, ect ect .
    All i want to see is for the battlers be able to live and support the family with the every day things we all rely on from day to day to be affordable..Interest Rates low ,petrol low ,food bills low,,Both party’s want to empty our pockets thats all I see..Not to be trusted ..

    • Yes you are right, it is a choice between the Liberals who consistently look after their mates, those who are wealthy and Labour who consistently try to help the workers and have their eye on the future. Both have to contend with what occurs in the rest of the world as well, because unfortunately Australia is part of the rest of the world. Tough decisions have to be made sometimes, ones we dont always like. We were not immune entirely to the Global Financial Crisis, but at least the Labour party kept our heads above water. I still have a job.

      • A lot of those things were implemented by state Labor governments eg state owned electricity. Yes we got the GST from a Liberal government but how else were they to pay for the excesses of the previous Labor years?

        Then if you think you had high interest rates under the previous Liberal government, just try 19% under Labor’s Hawke-Keating reign as we experienced.

        You can throw stones at both sides. The fact remains that the Liberals manage money well, leaving substantial surpluses which Labor then manages to turn into substantial deficits within a few years. It has always been thus.

        I prefer a government who recognises the well-being of Australia, that first delivers a surplus which they can then share with the Australian people. In actual fact, most Australians recall the years from 2000-2007 as good years.

        And, by the way, did you really say it was the libs who look after their mates? How do you explain the fact that our current government and its departments are riddled with ex-union members?

  5. Julia Gillard’s new tax rates are a con and a disgrace. Here is my personal situation:
    I retired last year and am in receipt of three small pensions totalling about $32000 per annum. The details are:
    1. Comsuper pension of about $12000 per year. (I claim the tax free threshold on this pension).
    2. A super pension of about $12000 per year.
    3. A transition to retirement pension of about $8000 per year.
    I cannot claim the tax free threshold on pensions 2 and 3 as this can only be claimed once and I claimed this on pension 1. The first pension payment in July resulted in a total of $35 pension reduction in pension 2 and 3. On contacting the superannuation fund I was advised that the reduction in my pension was due to the increased taxation rates, ie, increase from 15 cents to 19 cents. I was advised that there was nothing that could be done as PAYG was deducted in accordance with ATO instructions and that I would have to recover the money at the end of the financial year when I do my tax return. In the meantime I have to live on a reduced pension.

  6. Mike McC says:

    Hi Trish,
    One question: I’am 57 years old and still working with a house loan and just enough in super to pay the house off, do you think the Federal government is likely to stop bulk withdrawals from super in the next few years? I have an Autisic son who is 31 and lives at home. My wife looks after him 24/7 but doesn’t receive the cares pension because I earn $1000 over the current ceiling for payments and have always just earned above the ceiling. We will always care for him as long as we remain able to do so and get scared the rules on bulk withdrawal of super may change.
    Your thoughts would be appreciated.

  7. Providing rabates to offset the higher cost for carbon emissions is hardly an incentive for consumers to change; this tax and the wrapper it’s good for the environment was just a way for Gillard & labour to retain power…. And keep there lofty and high paid jobs.
    Increasing the GST on high polluting products (non bi fuels, plastic etc) would great an incentive to consumers to buy Eco friendly items, as well as Co to make better products. Again, this tax wasnt for our Australian environment (less than .5% global) but all about Gillard forming Govt.

  8. If I took home $36.954 and paid $8071 in tax this financial year and have around $1000 worth of claims…
    Does anyone have a rough idea of what refundI might receive ? No private health and I grossed just over 45k

  9. Rona Seabrook says:

    The rise will do no good for people living on the streets. Perhaps instead of sending millions over seas build hostels for our needy.John Howard did not give the age pensioners much.I will say Julia has done a lot better for the poor. Don’t know who is the best of both evils Tony or Julia. I will never vote again as it only takes a couple of men to choose who runs the country. Then it takes behind the doors to select who will run the country. Why then do we have big elections. No more for me.

  10. The increase in tax threshold to $18200 then increasing the marginal rates from 15% to 19% and 30% to 32.5% for the first and second rate tax scales respectively will NOT give us any tax savings at all. This is nonsense giving us something then taking it back by another means. This is stupid!!!!

    • done the calculation and we get nothing out of it as the 4% extra we get taxed on the 2nd teir takes away all the saving that we were supposedly given. $10.00 per fortnight equestes to nothing when we are about to absord a 3% increase in power cost sand a 6% increase on Water lets not worry about gas, food, public transport

    • if you do the math earning <80,000. will give savings of 500-2400$ the lower u earn (down to 19,000) the more you save. the whole idea is to help out the LOW income earner, witch this does and lets face it if u earn 80,000 or more u can afford to pay 10$ extra on your power bill.

      • I agree user.
        I earn 21,000 per year and I am thankful for the tax-free threshold – I would not be able to live if it was at 6,000 as previous.

        • But why should you live basically tax free?
          Don’t you use roads, schools, hospitals, don’t you receive or will you in the future receive income-tested social welfare payments (austudy, family tax benefit, rent assistance or aged pension etc)?
          You get to keep almost every dollar you earn but others shouldn’t?
          Not being critical of you, but a jump from $6,000 to $18,200 tax free cuts out a LOT of taxpayers. Less people supporting more. Interested in why you think thats fair?

          • Because I would not be able to function if I paid that much more tax.
            I live on $50 a week after all bills/other payments.
            No I don’t use schools, or hospitals, and no I don’t get anything from Centrelink as I live with my parents who ‘earn too much’, even though they are stuggling too, especially whilst trying to support 2 young adults.
            I wish my family or I could claim anything from Centrelink, but guess what? never going to happen, and I feel that this tax-free threshold is the only support the government is providing people like me.

  11. mike hale says:

    Hi Trish. Thanks for your invaluable information. Please keep it up.

    As for Wayne Swan ?? Once again just as you think you have got over the GFC debacle affecting retail super funds ( AMP and ING in my case ) and the false economies of negative geared investment property via Meriton, then they take the only remaining opportunity to even do it the hard way away from me. At 60 years old, having paid off the house, paid for the kids, helped them set up they own homes etc I was banking on pouring my income into my SMSF via concessional contributions to the max $50k ( over 50 and under $500K ) to get our super to where it needs to be so we don’t become burden on our children or the community. Just extended my retirement date ( if I can still compete ), by another 2 years. By the time they supposedly re-invoke the 50K cap it will be too late for me. At least with my SMSF I have control of what I have got. Or do I Wayne ?

  12. tim osborn says:

    This is great for uni students that also work as there is a good chance they will always be in the under 18k threshold

  13. I can see these new Tax brackets just causing more and more people to manipulate their tax returns to reduce their Taxable income as much as possible.
    It may also influence more people to start using salary sacrificing for cars as the tax brackets make it more appealing.

    • That’s what people do all ready, if your not doing it all ready your an idiot and if that’s the case your not gonna do it in the future. in essence the tax system has not really changed at all unless you earn <80,000 if you do you will get to keep off the bar 500-2400$ extra of your money per year that is no longer going to income tax. and lets face it if you earn over 80k then #%@^ you, you earn enuf to be able to afford paying a little more tax. if anything the upper brackets should have even higher tax.

  14. Raise the tax free threshold, one step forward, raise tax rates, one step backward, reduce the low income tax offset, one step backward, introduce a carbon tax , one step back, is anyone better off here. You better get your accountant to check your figures if you answered yes. Rearranging is what women are supposed to be good at but it seems Gillard can’t even do that properly. Unfortunately it seems all she knows is how to use a credit card like Craig Thomson.

  15. When looking at the higher rates, be careful to also allow for the higher threshhold, meaning more of your money ($12200 of it) doesn’t get taxed at all. However the new scales will also replace the Low Income Rebate which effectively made a tax threshhold of $16000 (being the full $1500 at that point), but petered out to nothing at $60,000. I just asked my tax agent to work out the end difference, and a person on $60,000 (as a median example) will be taxed about $500pa less than before, a little less than $10pw, which is exactly the amount of compensation the government has said it was offering for the calculated Carbon Pricing flow-on, in the package.

    So be careful about jumping to a conclusion that the tax is going up. It’s going down, exactly by the amount the government said it would.

  16. Here’s to you John.. please leave your comment about how good you are with your carbon tax next year. I’m sure it will bite you in the behind. As far Gillard is concerned, she is gas-bagging and should have stayed in the back benches. Gillard brags as if she was elected by the people. Hello Gillard, wake up and come out of your dream!

  17. Well it looks great to me … I dont expect to be a large income earner, and as far as a carbon tax goes I will be more than compensated. The amount of energy I use and the way I plan my home gives me the power to cut energy consumption. I guess the carbon issue is like being forced to give up smoking … and the vested interests have played very dirty to continue to be able to peddle the poison to our children. Vested interests and the withdrawal pains of lower energy usage are creating a bigger lie than those protesting.

    • Hi John, I completely agree. There are a lot of vested interests who would like to keep us hooked on carbon; it is much like tobacco companies and other corporate pushers trying to convince us we need their poison. I have than halved my energy usage over the last decade through simple measures with no decrease in my standard of living; and my usage was already pretty low compared with my friends. I am impressed with this government for having the guts to tackle this issue.

      • I agree wholeheartedly, this government is doing a great job, and there is a lot they are doing, that will never be published in the Murdoch or for that matter Fairfax press. Thank heavens our government has some foresite, and are not looking for the quick buck. Securing the future for our children and grandchildren.

  18. No big difference just added costs from this lie of a Carbon Tax. What a scam.

  19. Allan Hoffmann says:

    Smoke and mirrors as far as I can see. The average Australian will be the big loser after carbon tax kicks in … The sooner Gillard is dismissed the better …

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