Australia Income Tax 2024–25: Rates, Offsets & Take-Home Pay

Updated October 2026 · 5 min read

The 2024–25 financial year brought significant changes to Australian income tax through the Stage 3 tax cuts, which took effect on 1 July 2024. These cuts reduced tax for most Australians, especially those on middle incomes.

2024–25 Australian Tax Brackets

Medicare Levy

In addition to income tax, most Australians pay a 2% Medicare levy on taxable income. This funds Australia's public healthcare system (Medicare). Low-income earners may be exempt or pay a reduced levy.

Low Income Tax Offset (LITO)

The LITO reduces the tax payable for low-to-middle income earners:

• Maximum offset: $700 (for incomes up to $37,500)
• Phases out between $37,501 and $66,667
• No offset above $66,667

Example: $80,000 Salary Take-Home Pay

1. Gross income: $80,000
2. Income tax: nil on first $18,200 + 16% on $18,201–$45,000 + 30% on $45,001–$80,000 = approximately $17,547
3. Medicare levy: $80,000 × 2% = $1,600
4. Total deductions: ~$19,147
5. Take-home pay: ~$60,853 per year / ~$5,071 per month