How to use the bonus tax calculator
- 1 Enter your yearly salary before the bonus.
- 2 Enter the bonus before tax.
- 3 Choose whether you have a HELP debt.
- 4 Read the bonus you keep and the tax taken.
Worked example
An employee on $90,000 gets a $10,000 bonus. The whole bonus is taxed at 30% plus the 2% Medicare levy, so $3,200 goes in tax and they keep $6,800, or 68%. If it counts as ordinary time earnings, employer super of about $1,200 is also added.
Why bonus withholding looks high
- Withholding vs tax: employers use the ATO's method for back payments and bonuses, which can withhold more than you will finally owe. Any difference comes back at tax time.
- Salary sacrifice it: you can arrange to sacrifice a bonus into super before it is paid, within the concessional cap.
- Thresholds: a bonus can push income over Medicare levy surcharge or Division 293 thresholds.
- Super is usually paid on performance bonuses linked to ordinary hours.
Check the cap with the Salary Sacrifice Calculator, and see the MLS effect with the Medicare Levy Surcharge Calculator.
Features
Marginal method
Tax worked out on the bonus as the top slice of your income.
Medicare levy
2% levy included on the bonus.
HELP
Extra compulsory repayment from the higher income.
Super
Super guarantee if the bonus is ordinary time earnings.
When to use it
Annual bonuses
Know what you will actually receive. Sacrifice it with the Salary Sacrifice Calculator.
Sign-on bonuses
Check the tax on a lump sum when changing jobs. Over the threshold? See the Medicare Levy Surcharge Calculator.
Bracket creep
See how much is taxed at 37%. See your refund with the Tax Refund Calculator.
Salary sacrifice
Compare taking the bonus as super. Compare with the Pay Rise Calculator.
Related Pay and Super tasks
Frequently asked questions
How is a bonus taxed in Australia?
A bonus is ordinary income. It is added to your income for the year and taxed at your marginal rate, plus the 2% Medicare levy.
Why was so much tax withheld from my bonus?
Employers use a special withholding method for bonuses that spreads the payment across the year's pay periods. It can still look high, but the final tax is worked out in your tax return.
Will I get some of the bonus tax back?
If too much was withheld compared with your actual tax for the year, the difference is refunded when you lodge.
Is super paid on bonuses?
Super guarantee is paid on bonuses that relate to ordinary hours of work, such as performance bonuses. Bonuses for overtime only may not attract super.
Can I salary sacrifice a bonus?
Yes, if you arrange it before you become entitled to the bonus. It is then taxed at 15% in super, but it counts towards your concessional cap.
Does a bonus affect my HELP repayment?
Yes. HELP repayments are worked out on your repayment income, so a bonus can increase them.
Can a bonus push me into a higher tax bracket?
Only the part of your income above a threshold is taxed at the higher rate. You never earn less overall.
Does a bonus affect government payments?
It can reduce Family Tax Benefit and Child Care Subsidy, which depend on family income.
Does it affect the Medicare levy surcharge?
It can. If your income goes over the threshold and you have no hospital cover, the surcharge applies to all your income.
Is this calculator exact?
It estimates the final tax on the bonus. Withholding on the payslip may differ.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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