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PAYG withholding calculator

The amount your employer must withhold from each pay, worked out with the coefficients in the ATO's Schedule 1 published for payments made from 1 July 2026 — with every step shown.

Tax year 2026–27 Rules checked: November 2026 How we calculate

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Pay frequency
More options
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For example zone or invalid-carer offsets. Most people leave this at 0.

Tax withheld this pay$598fortnightly pay
Net pay
$2,402.00
Withheld over a year
$15,548
Where the money goes
  • Net pay$2,40280%
  • PAYG withheld$59820%

Schedule 1 calculation (payments from 1 July 2026)

Scale used
Scale 2 – tax-free threshold claimed
Weekly earnings used in the formula (x)
$1,500.99
Coefficients a / b
0.3200 / 181.7319
Weekly withholding y = a·x − b (rounded)
$299
Withholding before offsets
$598
PAYG withheld this pay
$598
  • Medicare levy adjustments for families (the Medicare levy variation declaration with dependants) are not applied here.

This is an estimate based on published rates, not tax or financial advice. Your payslip or assessment may differ. We are an independent site, not affiliated with any government agency.

How Schedule 1 works

The ATO publishes withholding as a set of straight-line formulas, y = ax − b, where y is the weekly amount to withhold and x is the weekly earnings. The coefficients a and b change with the earnings band and with the scale that matches your tax file number declaration.

  1. Convert to weekly earnings. Weekly pay is used as is. Fortnightly pay is halved. Monthly pay is multiplied by 3 and divided by 13 (adding one cent first if the amount ends in 33 cents). Quarterly pay is divided by 13.
  2. Drop the cents and add 99 cents. $1,333.45 becomes x = $1,333.99.
  3. Find the band and apply y = ax − b. Round the result to the nearest dollar (50 cents rounds up) — directly, without rounding to cents first.
  4. Scale back to the pay period. Fortnightly: y × 2. Monthly: y × 13 ÷ 3, rounded to the nearest dollar. Quarterly: y × 13.
  5. Subtract offsets claimed on a withholding declaration: 1.9% of the annual amount per weekly pay, 3.8% per fortnightly pay, 8.3% per monthly pay.

Worked examples from the ATO

The calculator is tested against the examples the ATO publishes with the 2026 schedule. Tan earns $5,400.33 a month, claims the tax-free threshold and a $1,365 tax offset. The weekly equivalent is ($5,400.34 × 3) ÷ 13 = $1,246.23, so x = $1,246.99. In the $865 – $1,282 band, a = 0.3227 and b = 185.1935, giving $217 a week. Monthly that is $217 × 13 ÷ 3 = $940, less 8.3% of $1,365 ($113), so $827 is withheld.

ATO example: $5,400.33 a month, scale 2, $1,365 offsets

Tax withheld this pay$827monthly pay
Net pay
$4,573.33
Withheld over a year
$9,924

Schedule 1 calculation (payments from 1 July 2026)

Scale used
Scale 2 – tax-free threshold claimed
Weekly earnings used in the formula (x)
$1,246.99
Coefficients a / b
0.3227 / 185.1935
Weekly withholding y = a·x − b (rounded)
$217
Withholding before offsets
$940
Less tax offsets claimed
-$113
PAYG withheld this pay
$827

Prue is paid $1,299.30 a fortnight, has a full Medicare exemption (scale 5) and claims $1,645 of offsets. Her weekly equivalent is x = $649.99, the weekly withholding is $43, the fortnightly amount $86, and after 3.8% of $1,645 ($63) she has $23 withheld.

What changed on 1 July 2026

The ATO reissued Schedule 1 on 17 June 2026 to reflect the 15% tax rate on income between $18,201 and $45,000. The tax-free band on scale 2 now ends at $362 a week. The Medicare levy now starts at weekly earnings of $538 and is fully phased in at $673, reflecting the higher low-income threshold of $28,011. Scale 1 — used when the tax-free threshold is not claimed — now begins at 15c in the dollar on the first $188 a week.

Practical tips for employers and employees

  • Only one employer should apply scale 2. If you have two jobs and both apply the tax-free threshold, too little is withheld and you will get a bill.
  • Lodge a Medicare levy variation declaration if you qualify for an exemption or a family reduction; otherwise the levy is withheld in full.
  • Allowances subject to withholding are added to earnings before the 99 cents step. Reimbursements that are not income are left out.
  • Check the annual effect with the pay calculator, which compares a year of withholding with the tax actually payable.

Questions people ask

Why does my payslip show slightly different tax from this calculator?

Payroll software may use the ATO tax tables instead of the formulas, which can differ by a dollar or two for weekly earnings above $3,400 or fortnightly earnings above $6,800 — the ATO accepts either method. Bonuses, back pay and leave loading also change the amount.

What is scale 1 versus scale 2?

Scale 2 applies when you claim the tax-free threshold on your TFN declaration. Scale 1 applies when you don't, which is normal for a second job, so more tax is withheld from each dollar.

What happens if I don't give my employer a TFN?

Your employer must withhold 47% (45% for foreign residents) from every dollar, ignoring cents. Provide your TFN within 28 days of starting to avoid it.

Do I need to do anything when there are 27 fortnightly pays in a year?

The formulas assume 26 fortnights. In a 27-pay year your employer withholds slightly too little over the year. You can ask them to withhold an extra amount; the ATO publishes a table of suggested amounts (for example $12 a fortnight on earnings of $1,700 to $5,199).

Does this include the HELP component?

Study loan withholding uses a separate schedule (Schedule 8). Switch on the option to see an estimate based on your annual compulsory repayment.

Official sources

Rules checked: November 2026.

This is an estimate based on published rates, not tax or financial advice. Your payslip or assessment may differ. We are an independent site, not affiliated with any government agency. Read the full disclaimer.