How We Calculate Pay and Tax

Every rate is taken from a primary source, which means the Australian Taxation Office for tax, withholding schedules, superannuation, Medicare and fringe benefits tax, the Fair Work Ombudsman for award and minimum rates, and the Fair Work Commission’s own Orders for the National Minimum Wage. Olivia Harper checks each one against the clause or schedule it came from before it is published here.

The employer pages on Pay Rates by Employer take their rates only from the employer's enterprise agreement as the Fair Work Commission publishes it, with its approval decision, and from the Commission's retail award determinations where the agreement ties its increases to the award. Where an agreement does not print the rate in force now, the page works it out from the agreement's own increase rule and marks it as derived.

The scales on Public Sector Pay Scales come from the Defence Force Remuneration Tribunal's Salaries Determination, checked against Defence's own salary sheet and pay manual, and from the thresholds the Australian Public Service Commission published for every agency. No union, recruiter or salary survey figure is used.

The Age Pension Calculator takes its rates, free areas, cut-offs, deeming rates, Work Bonus amounts, Rent Assistance and pension age from Services Australia, the Department of Social Services rates list and the DSS Social Security Guide, never from a super fund, adviser or other calculator. A figure ships only if Services Australia and DSS print it to the same cent, and every printed income and assets cut-off and Rent Assistance ceiling must add up from its free area, maximum rate and taper. It is an estimate: transitional rate pensioners, non-residents, couples where one partner is not on the Age Pension, income streams held before 2015, granny flat rights and gifting are not modelled, and Services Australia decides what is paid.

The Family Tax Benefit Calculator takes its rates, free areas, tapers and supplements from the DSS Family Assistance Guide and Services Australia, never from a Centrelink helper, parenting or other calculator site. A figure ships only if the Guide's yearly rate, at 14 days in 365, gives the fortnightly rate Services Australia prints to the cent, and only if the calculator reproduces every Part A and Part B income limit Services Australia prints and the Guide's own Method 2 worked example. It covers the standard case: shared care, child support, income support payments, Rent Assistance, the Energy Supplement and the newborn supplement are not modelled, and Services Australia decides what is paid.

Medicare levy thresholds, 2026-27: The ATO has not published 2026-27 Medicare levy reduction thresholds. These are the 2025-26 thresholds carried forward and will be corrected when the ATO publishes.

Medicare levy thresholds, SAPTO, 2026-27: Re-checked 2026-10-02: the ATO page still states 2025-26 figures only. These are the 2025-26 thresholds carried forward and will be corrected when the ATO publishes.

Medicare levy family thresholds, 2026-27: Re-checked 2026-10-02: the ATO page still states 2025-26 figures only. These are the 2025-26 thresholds carried forward and will be corrected when the ATO publishes.

SAPTO transfer between spouses, 2026-27: The ATO states these parameters without a year and has published no 2026-27 transfer example. Carried forward from 2025-26. Run through the same steps at the 15c rate, they reproduce every 2026-27 shading-out threshold the ATO publishes to the dollar.

Zone and overseas forces tax offset, 2026-27: The ATO has not published 2026-27 zone offset instructions; they come with the 2027 return instructions. These are the 2025-26 figures carried forward. They are dollar amounts written into s 79A(2) of the Income Tax Assessment Act 1936, and the ATO Zone tax offset page, last updated 8 June 2026, states the same three fixed amounts without a year.

Zone tax offset base amount, 2026-27: Not yet published for 2026-27. The 2025-26 base amounts carried forward.

Study and training loan repayment, 2027-28 onwards: The ATO updates the repayment thresholds each year and has published them only to 2026-27. Payoff projections carry the 2026-27 thresholds forward unchanged, which can bring the payoff year forward when pay rises.

Study and training loan indexation, 1 June 2027 onwards: The ATO sets each 1 June rate after the December CPI and WPI are released, so no rate from 1 June 2027 exists yet. Payoff projections carry the 1 June 2026 rate of 2.8% forward to every later year.

Fringe benefits tax, year ending 31 March 2028: The ATO has not published rates or caps for the FBT year ending 31 March 2028. These are the year ending 31 March 2027 figures carried forward and will be corrected when the ATO publishes.

It converts the amount you enter into its annual equivalent, applies the progressive tax brackets slice by slice, adds the Medicare levy including its shade-in band, and divides the result back into every pay cycle. Employer superannuation is calculated on your gross salary and shown separately, because it is paid on top of your pay rather than deducted from it.

A tax return runs the same brackets, offset and levy on a finished year, adds any surcharge and study loan repayment on income that includes reportable fringe benefits and employer super contributions, and nets the total against the tax withheld. The refund or bill is worked out on the Tax Return Calculator.

The default calculation excludes the Low Income Tax Offset, because PAYG withholding excludes it too: including it by default would make the figure disagree with your payslip. You can switch it on to see your annual position instead. HECS and HELP repayments, the Medicare levy surcharge, salary sacrifice, salary packaging, Division 293 and a second job’s withholding each have their own calculator rather than being folded into the default result. Not yet modelled anywhere: novated leases, and non-resident and working holiday maker rates. Where a calculation is not supported we would rather leave it out than approximate it.

The calculation engine is covered by automated tests that run on every build. They check our output against worked examples published by the ATO, including the ATO’s own Medicare levy reduction example, and they assert that every bracket boundary matches the cumulative figure the ATO publishes. The tests also check that take-home pay never decreases as gross pay rises, so no income level is ever worse off from earning one more dollar.

The Weekly Tax Table, Fortnightly Tax Table and Monthly Tax Table are generated by the withholding engine and checked against every row the ATO prints in its own NAT 1005, NAT 1006 and NAT 1007 tables: 19,450 figures, each to the dollar. A single dollar of disagreement fails the tests.

If you find a figure that does not match the ATO or Fair Work, tell us and we will fix it and record the change. Our Editorial Policy sets out how corrections are handled.