Bonus Tax Calculator — Updated for 2026–2027
Bonus Tax Calculator: Schedule 5 Withholding & Marginal Tax
Work out exactly how much of your bonus or commission you keep after PAYG, Medicare and HECS. A bonus is ordinary income taxed at your marginal rate, and a Schedule 5-compliant payroll withholds close to that — so the result shows the real tax and the payslip figure landing close together. Small gaps reconcile at lodgment. It works for one-off bonuses, commissions and similar lump-sum payments.
Bonus Tax
Bonus details
Bonus Tax Breakdown
You keep
$3,400
out of your $5,000 bonus
32.0% effective rate on bonus
- Total tax
- $1,600
- Bonus eff. rate
- 32.0%
- Marginal rate
- 30.0%
- Overall eff. rate
- 21.5%
- Base salary eff. rate
- 20.8%
- Combined take-home
- $70,680
Tax on Your Bonus
- Income tax on bonus
- $1,500
- Medicare Levy
- $100
- Total deducted
- $1,600
- Net bonus
- $3,400
Schedule 5 Withholding Estimate (Method A)
- Schedule 5 withholding (Method A estimate)
- $1,612
- Real tax owed at lodgment
- $1,600
- Estimated refund at tax time
- $12
Schedule 5 withholding sits close to the real tax at typical incomes — a bonus is ordinary income taxed at your marginal rate, not a higher one, and small gaps are just per-period table effects. At lower incomes the tables can over-withhold, which is refunded when you lodge. Where the Medicare Levy Surcharge applies it is never withheld from a payslip, so that part becomes payable at lodgment instead.
Annual Summary
- Base salary
- $85,000
- Base take-home
- $67,280
- Combined gross (base + bonus)
- $90,000
- Combined take-home
- $70,680
See your full annual take-home
View your complete yearly pay breakdown including this bonus.
What's next
This calculator shows the actual taxon your bonus based on ATO income tax brackets. A bonus is ordinary income taxed at your marginal rate, and a Schedule 5-compliant payroll withholds close to that — the withholding figure here assumes a fortnightly pay cycle (26 periods), so other cycles differ slightly. At lower incomes the per-period tables can over-withhold, which comes back as a refund at lodgment; the Medicare Levy Surcharge is never withheld, so where it applies that part is payable when you lodge. A payslip showing a materially different figure isn’t necessarily wrong — Method B or a different pay cycle also follows Schedule 5 and can withhold more or less — and any gap is squared up when you lodge. For very high earners the 47% cap can leave withholding below the tax owed, so a small amount is payable at lodgment. This is not financial advice. Source: ATO Schedule 5 — Tax table for back payments, commissions, bonuses and similar payments.
Reviewed by Ashma Ghimire, ASA, CPA AustraliaLast reviewed 15 May 2026
Bonus Tax Examples, 2026–2027
Quick reference for common base-salary and bonus combinations. Assumes tax-free threshold claimed, no HECS debt, and no salary sacrifice.
| Base Salary | Bonus | Tax on Bonus | You Keep |
|---|---|---|---|
| $60,000 | $5,000 | $1,675 | $3,325 |
| $80,000 | $10,000 | $3,200 | $6,800 |
| $95,000 | $5,000 | $1,600 | $3,400 |
| $130,000 | $20,000 | $7,700 | $12,300 |
| $160,000 | $25,000 | $10,525 | $14,475 |
| $200,000 | $50,000 | $24,250 | $25,750 |
Schedule 5 vs marginal — how bonus tax works
There is no special bonus tax rate. A bonus is ordinary income taxed at your marginal rate, and when your employer adds it to your pay they calculate withholding using ATO Schedule 5. Schedule 5 spreads the bonus across the whole financial year rather than taxing it as a one-off spike, so a compliant payroll closely tracks the extra tax the bonus attracts at your marginal rate.
The actual taxyou owe on the bonus is simply the difference between your total tax on (base salary + bonus) and your tax on (base salary alone). This calculator shows that figure alongside the Schedule 5 withholding — for most people they land close together. The two aren’t always identical: the Medicare Levy Surcharge is assessed at lodgment and never withheld, so where it applies a bill can arise, and at lower incomes the per-period tables carry no low-income offset and over-withhold a little, which comes back as a refund. A payslip withholding a materially different amount can still follow Schedule 5 — Method B or a non-fortnightly pay cycle changes the figure, while a crude flat top rate isn’t Schedule 5 at all — and any excess over the tax you owe comes back when you lodge — the tax refund guide walks through how the reconciliation works.
If you want the fuller explanation of Schedule 5 withholding, plus how HELP, MLS, and super can change the result, the bonus tax guide walks through it in more detail.
Withholding is capped at 47% of the bonus amount (the top marginal rate of 45% plus 2% Medicare Levy). For very high earners — or where a study loan lifts the marginal rate past the cap — this limits withholding to below the tax actually owed, leaving a small amount payable at lodgment rather than a refund.
If you’d rather pay less tax on the bonus in the first place, salary sacrificing part of it into super before you become entitled to it is taxed at the concessional rate instead of your marginal rate. The super salary sacrifice calculator models the trade-off against the concessional contributions cap.
If you have a study loan, the HECS calculator shows how a bonus shifts your repayment, and the HECS/HELP repayment guide explains the income-band system in full. If the bonus pushes your income near the surcharge threshold, the Medicare Levy Surcharge guide covers thresholds, tiers and when private hospital cover removes the charge.
Frequently Asked Questions
How is a bonus taxed?
Your bonus is treated as ordinary income — there is no separate "bonus tax rate" in the tax code. It gets added to your regular salary for the year, and tax is calculated on the combined total using the 2026-27 ATO progressive brackets. The real tax you owe on the bonus is the difference between your tax on (salary + bonus) and your tax on salary alone. For a $95,000 salary with a $5,000 bonus, that real tax comes to $1,600, leaving $3,400 of the bonus in your pocket. Use the calculator above to see the figures for your own salary and bonus.
Why does my bonus look over-taxed on my payslip?
A bonus isn't taxed at a higher rate — it's ordinary income taxed at your marginal rate. ATO Schedule 5 spreads the bonus across the whole year and withholds it at that marginal rate, so a compliant payroll withholds close to the real extra tax. Some over-withholding is normal and legitimate: the per-period tables carry no low-income tax offset, so at lower incomes they withhold a little more than you end up owing, and the difference is refunded when you lodge. A noticeably different figure doesn't have to mean a payroll error — Method B or a different pay cycle also follows Schedule 5 and changes the amount withheld — and any over-withholding, including a crude flat top rate on the whole bonus, comes back at lodgment. Schedule 5 caps withholding at 47% of the bonus (top marginal rate of 45% plus 2% Medicare Levy); for very high earners the cap can leave withholding slightly below the tax owed, so a small amount is payable at lodgment rather than refunded.
How do I calculate tax on a bonus?
Three steps: calculate the income tax on (base salary + bonus) using the current 2026-27 marginal brackets, calculate the tax on the base salary alone, then subtract one from the other — the difference is the real tax on the bonus. That is close to what a Schedule 5-compliant payroll withholds, because the schedule spreads the bonus across the year at your marginal rate, though the withholding tables can differ slightly from the final assessed tax. Enter your salary and bonus into the calculator above and it runs both calculations side by side, including HECS/HELP, Medicare Levy and Medicare Levy Surcharge where they apply.
How much tax will I pay on a $10,000 bonus?
On an $80,000 salary, a $10,000 bonus draws roughly $3,200 in extra tax once income tax and 2% Medicare Levy apply — an effective rate of 32.0% on the bonus — leaving about $6,800. The exact figure depends on your base salary, because a bonus is taxed at your marginal rate. Earn enough to cross into the 37% bracket and you'll pay more: on $130,000 a $20,000 bonus draws $7,700 in tax, leaving $12,300. Enter your own figures above for an exact result.
Can I reduce the tax on my bonus?
You can't make a bonus tax-free, but you can legitimately lower the tax by salary sacrificing some or all of it into super before you become entitled to it. Concessional (pre-tax) super contributions are taxed at 15% rather than your marginal rate (or 30% once your income passes the $250,000 Division 293 threshold), so redirecting a bonus into super can still pay off on a higher income — provided your total concessional contributions stay within the $32,500 annual cap, which also counts your employer's compulsory super. Other options include timing the bonus into a lower-income year where your employer allows it, and bringing forward deductible expenses before 30 June. Because salary sacrifice has to be arranged in advance, speak to your payroll team early. Work out your bonus tax above first, then weigh up sacrificing part of it into super.
Is HECS/HELP repayment affected by a bonus?
Yes — your bonus counts towards your HECS/HELP repayment income, so a bonus can push you into a higher repayment band or trigger your first repayment if you were sitting below the threshold. HECS uses a tiered system: you pay more only on the portion of income that falls in each band, not a flat rate on everything. Bonuses are particularly sharp because payslip withholding doesn't always deduct HECS the same way it deducts income tax, so under-payment can land on your end-of-year tax bill. Toggle HECS on in the calculator above to see exactly how your bonus affects your repayment.
Can a bonus push me over the Medicare Levy Surcharge threshold?
Yes — and this is one of the most common bonus-related surprises. The Medicare Levy Surcharge starts at 1% of total income for singles earning over $105,000 without an appropriate private hospital cover, and the rate rises as income increases. Because the surcharge applies to your full income (not just the amount above the threshold), a bonus that nudges you over the line can trigger a noticeable extra bill at tax time. Tick the "Private health insurance" toggle above if you hold eligible hospital cover — the calculator removes the MLS from your result.
Does my employer pay super on a bonus?
Usually yes. The Superannuation Guarantee requires employers to pay 12% super on Ordinary Time Earnings (OTE), which generally covers performance bonuses, sign-on bonuses, and commissions paid for work performed during ordinary hours. A few categories sit outside OTE — overtime pay, genuine redundancy payments, and some lump sums — and don't attract super. Your bonus payslip should show a separate super line if super applies. If it doesn't, ask your payroll team to confirm whether the bonus is treated as OTE under the ATO's definition before assuming it's missing.
What is the maximum withholding rate on a bonus?
Schedule 5 caps total withholding at 47% of the bonus amount — the top marginal rate of 45% plus the 2% Medicare Levy. For most people the schedule withholds at their ordinary marginal rate, so the cap never binds. It only matters for very high earners (or where a study loan lifts the marginal rate above 47%): there the cap limits withholding to below the tax actually owed, so instead of a refund a small amount is payable when you lodge. At an ordinary full-time income, a payslip showing a different figure can still follow Schedule 5 — Method B or a different pay cycle changes the amount withheld — and any excess over the tax you owe is reconciled at lodgment.