PAYG Tax Table Australia | 2025–26 Withholding Guide

PAYG withholding is the system the ATO uses to collect income tax throughout the year. Rather than paying a single lump sum at tax time, your employer deducts tax from each pay and sends it directly to the ATO on your behalf. This page is the central hub for 2025–26 PAYG withholding tax tables — use the links below to jump to the detailed weekly tax table or fortnightly tax table, or keep reading for a complete overview of how PAYG withholding works.

How PAYG Withholding Works

The PAYG withholding system is straightforward in principle. Every time your employer pays you, they calculate the tax to withhold based on three things: your gross earnings for that pay period, the pay cycle (weekly, fortnightly, or monthly), and the information you provided on your TFN declaration form — particularly whether you claimed the tax-free threshold.

Employer obligations

Employers must register for PAYG withholding with the ATO, withhold the correct amount from each payment, report withheld amounts on their Business Activity Statement (BAS), provide payment summaries (or report via Single Touch Payroll), and pay the withheld amounts to the ATO by the due dates.

Single Touch Payroll (STP) has largely replaced manual payment summaries. Most employers now report payroll information to the ATO each pay cycle, which means your income statement appears in myGov automatically.

Employee TFN declaration

When you start a new job, you complete a TFN declaration (NAT 3092) that tells your employer whether to claim the tax-free threshold, whether you have a HELP, VSL, SFSS, or TSL debt, and your residency status. If you do not provide a TFN, your employer must withhold at the top marginal rate (47% including Medicare levy) from every dollar you earn — there is no tax-free threshold applied.

2025–26 Income Tax Brackets

The withholding tables are built from the individual income tax rates set by the ATO. For 2025–26, the tax brackets for Australian residents are:

These rates do not include the 2% Medicare levy, which is added on top. The PAYG withholding tables already factor in the Medicare levy, so employers do not need to calculate it separately.

Low Income Tax Offset (LITO)

The Low Income Tax Offset reduces tax for lower-income earners. For 2025–26, the maximum offset is $700 for taxable incomes up to $37,500. It reduces by 5 cents per dollar between $37,500 and $45,000, then by 1.5 cents per dollar between $45,000 and $66,667. The PAYG withholding tables already account for LITO, which is why the effective withholding rate for lower earners is less than the bracket rates suggest.

PAYG Tax Tables by Pay Cycle

The table below shows approximate withholding amounts for common salary levels. These figures assume the employee has claimed the tax-free threshold, has no HELP debt, and is an Australian resident. Amounts include the 2% Medicare levy.

These are indicative figures based on the Schedule 1 formulas. Your actual withholding may differ slightly due to rounding and how your employer’s payroll software applies the ATO coefficients.

For full lookup tables covering every income level, see the detailed pages:

• Weekly tax table 2025–26 — withholding amounts for every weekly earnings level
• Fortnightly tax table 2025–26 — withholding amounts for every fortnightly earnings level

Tax-Free Threshold

The tax-free threshold for 2025–26 is $18,200 per year, which works out to $350 per week or $700 per fortnight. If you earn below this amount, no tax is withheld from your pay (assuming you have claimed the threshold).

Who can claim the tax-free threshold

Any Australian resident for tax purposes can claim the tax-free threshold, but only from one payer at a time. You indicate your choice on the TFN declaration form when you start a job.

What happens if you do not claim it

If you choose not to claim the tax-free threshold — or if you do not provide a TFN declaration — your employer withholds tax from the first dollar you earn. The “no tax-free threshold” withholding rates are significantly higher. For example, on weekly earnings of $769 (equivalent to $40,000 per year), the withholding without the tax-free threshold is roughly $227 per week compared to $96 with it.

Second job implications

If you have two jobs, claim the tax-free threshold from your highest-paying employer only. Your second employer withholds at the higher “no tax-free threshold” rates. At tax time, the ATO combines your income from both jobs to calculate your actual tax liability, and you receive a refund if too much was withheld or owe additional tax if not enough was withheld.

HELP, VSL, and SFSS Debt Repayments

If you have a Higher Education Loan Program (HELP), VET Student Loan (VSL), Student Financial Supplement Scheme (SFSS), or Student Start-up Loan (SSL) debt, your employer withholds additional amounts on top of regular PAYG tax once your income exceeds the repayment threshold.

From 2025–26, compulsory HELP repayments use a new marginal rate system. No repayment is required if your repayment income is $67,000 or less (up from $54,435 in 2024–25). Above $67,000, you repay 15 cents per dollar over the threshold up to $125,000, then $8,700 plus 17 cents per dollar up to $179,285, then 10% of total repayment income above that. Your repayment income includes taxable income plus any net rental losses, reportable fringe benefits, and reportable super contributions.

You must indicate on your TFN declaration that you have a study or training loan debt. If you do not, your employer will not withhold the additional repayment amounts, and you may end up with a tax bill when you lodge your return.

Medicare Levy and Medicare Levy Surcharge

Medicare levy (2%)

The 2% Medicare levy is included in the standard PAYG withholding tables (Schedule 1). You do not need to do anything extra — your employer’s payroll system handles it automatically.

Some people are entitled to a Medicare levy reduction or exemption. If you qualify, your actual levy may be lower than the standard withholding tables assume. If you are entitled to a reduction, you can apply for a withholding variation (see below).

Medicare levy surcharge (1%–1.5%)

The Medicare levy surcharge (MLS) is a separate charge that applies to higher earners who do not hold an appropriate level of private hospital cover. It is not included in the standard withholding tables. The MLS rates for 2025–26 are:

Family thresholds are higher ($202,000 base, plus $1,500 per dependent child after the first). If the MLS applies to you, you can either take out private health insurance or request a withholding variation to spread the cost across the year.

PAYG Withholding Variation

If the standard withholding tables result in too much or too little tax being withheld, you can apply to the ATO for a withholding variation. This is particularly relevant for property investors.

For property investors

If you own an investment property with expenses that exceed your rental income (negative gearing), you may be entitled to reduce your PAYG withholding. Instead of waiting until tax time for a refund, a withholding variation lets you receive the tax benefit in each pay packet throughout the year.

To apply, you lodge a PAYG withholding variation application (NAT 2036) with the ATO, estimating your total income and deductions for the year. The ATO then issues a variation notice that your employer uses to reduce your withholding.

Common deductions that support a variation include loan interest on investment properties, rental property depreciation (Division 40 and Division 43), property management fees, repairs and maintenance, and insurance and council rates.

Use our negative gearing calculator to estimate your net rental position and potential tax benefit — the results can help you prepare your variation application.

Schedules Beyond Schedule 1

Schedule 1 covers regular salary and wages, but the ATO publishes additional withholding schedules for specific payment types:

Most employees only need to be aware of Schedule 1. If you receive an employment termination payment, back pay, or work as a contractor, your employer or payer should apply the appropriate schedule automatically.

Related Resources

Tax table lookup pages

• Weekly tax table 2025–26 — full withholding lookup for weekly pay cycles
• Fortnightly tax table 2025–26 — full withholding lookup for fortnightly pay cycles

Income tax calculators

• Income tax calculator — full Australian income tax calculator with Medicare levy, MLS, and the new 2025–26 HELP marginal repayment system
• Weekly tax calculator — estimate weekly, fortnightly, or monthly take-home pay

Business tax calculators

If you run a business and need to manage your own PAYG obligations:

• Sole trader tax calculator — estimate income tax, Medicare levy, HELP repayments, and quarterly PAYG instalments
• BAS calculator — estimate GST on BAS labels 1A and 1B; PAYG withholding still needs to be calculated separately
• GST calculator — calculate GST on goods and services

Property investment calculators

For property investors looking to understand their tax position or apply for a withholding variation:

• Negative gearing calculator — estimate your net rental income and tax benefit
• Investment property calculator — all-in-one property investment analysis
• Property depreciation calculator — estimate Division 40 and Division 43 depreciation deductions
• Capital gains tax calculator — estimate CGT when selling an investment property