Stage 3 Tax Cuts Australia: How They Changed Your Take-Home Pay
The Stage 3 tax cuts are the most significant restructuring of Australia's income tax brackets in decades. They took effect from 1 July 2024 and continue to apply in the 2025-26 financial year. Here is what changed and exactly how much you save.
Use our Australian pay calculator to see your exact take-home pay under the current 2025-26 rates.
Old vs New Tax Brackets: The Full Comparison
| Taxable income | Rate |
|---|---|
| $0 – 18,200 | 0% |
| 18,201 – 45,000 | 19% |
| 45,001 – 120,000 | 32.5% |
| 120,001 – 180,000 | 37% |
| Over 180,000 | 45% |
| Taxable income | Rate |
|---|---|
| $0 – 18,200 | 0% |
| 18,201 – 45,000 | 16% |
| 45,001 – 135,000 | 30% |
| 135,001 – 190,000 | 37% |
| Over 190,000 | 45% |
Three things changed. The 19% rate fell to 16%. The 32.5% rate fell to 30%, and that bracket now runs to $135,000 instead of $120,000. The 37% bracket now runs from $135,001 to $190,000, so the 45% rate starts at $190,001 instead of $180,001. The tax-free threshold stayed at $18,200.
How Much More Do You Take Home?
Annual income tax at common salaries under 2023-24 rates and 2025-26 rates, both after the low income tax offset:
| Salary | Tax (2023-24) | Tax (2025-26) | Annual saving |
|---|---|---|---|
| 50,000 | 6,467 | 5,538 | +929 |
| 60,000 | 9,867 | 8,688 | +1,179 |
| 70,000 | 13,217 | 11,788 | +1,429 |
| 80,000 | 16,467 | 14,788 | +1,679 |
| 100,000 | 22,967 | 20,788 | +2,179 |
| 120,000 | 29,467 | 26,788 | +2,679 |
| 150,000 | 40,567 | 36,838 | +3,729 |
| 200,000 | 60,667 | 56,138 | +4,529 |
Medicare levy is not included because it was 2% in both years.
Who Benefits Most from Stage 3?
- $18,201–$45,000: 3 cents less on every dollar in this range, worth 804 a year at $45,000.
- $45,001–$135,000: 2.5 cents less on every dollar up to $120,000, and 7 cents less from $120,001 to $135,000 (37% became 30%).
- $135,001 and above: the saving keeps growing until $190,000 (8 cents less from $180,001 to $190,000) and is 4,529 a year for every income above that.
Impact on Take-Home Pay
Want to see your full take-home pay under the current 2025-26 Stage 3 rates? Use our salary breakdown guides for common income levels:
- $50,000 salary take-home pay →
- $60,000 salary take-home pay →
- $70,000 salary take-home pay →
- $80,000 salary take-home pay →
- $90,000 salary take-home pay →
- $100,000 salary take-home pay →
- $120,000 salary take-home pay →
- $150,000 salary take-home pay →
Calculate Your Take-Home Pay Under Stage 3
Enter your salary and see exactly how much you take home under the 2025-26 Stage 3 tax brackets.
Use the Free Pay Calculator →Source: ATO: Tax rates - Australian residents (2023-24 and 2025-26 tables).