Pay and salary · Content updated 14 September 2026

What does a pay rise add after tax?

Compare the change in your take-home pay, not just the percentage increase in your salary.

Start with two comparable salary figures

Write down your current base salary and proposed base salary, excluding employer super. If an offer is a package, separate the super component first. A rise from $80,000 to $84,000 is $4,000 gross a year, or 5%. That is not automatically $4,000 more to spend.

Calculate each result, then subtract

Use the pay rise calculator with the same financial year and personal settings for both salaries. Subtract current annual take-home pay from proposed annual take-home pay. Divide the difference by 52, 26 or 12 to compare annualised weekly, fortnightly or monthly amounts.

Do not apply your average tax rate to the increase. Australian income tax is progressive: the extra income may fall into one bracket or cross several. The legislation setting 2026–27 resident rates sets different rates for different portions of taxable income.

Keep the assumptions consistent

• Include your study loan setting in both scenarios. Repayment income can differ from taxable income.
• Use the same hospital cover and family circumstances when assessing Medicare levy surcharge exposure.
• Separate guaranteed base pay from a discretionary bonus or commission.
• Compare hours as well as annual pay if the new role changes your working week.

A mid-year rise is a different question

The full-year comparison shows the ongoing value of the new rate. If it starts part-way through the year, only part of that year's wages will be earned at the higher rate. Back pay and bonuses can also use different withholding calculations. See PAYG withholding versus your tax bill before comparing the estimate with a payslip.

Use the result in a negotiation

Compare $80,000 and $84,000 after tax, then model your own figures. The result helps you quantify an offer; it does not establish a market salary or a legal minimum wage. For award rates and entitlements, use the Fair Work Ombudsman.