Mortgage Calculator Salary: What You Actually Take Home After Tax and Medicare

How to Work Out What Clears After Tax and Medicare

When you see a salary figure in a job ad or use a mortgage calculator salary tool, the number that matters is what lands in your bank account after tax and the Medicare levy. This guide walks you through the steps an Australian resident uses to estimate their take-home pay for the 2026–27 tax year.

Step 1: Know Your Gross Salary

Start with your annual gross salary. If your employer quotes a figure like $80,000, that is before tax. If the ad says "plus super", the 12% super guarantee is extra and does not reduce your take-home. The Take-home pay guide explains this in more detail.

Step 2: Apply the Tax Brackets

The Australian Taxation Office shows the following resident tax rates for 2026–27:

• Up to $18,200: nil tax
• $18,201 to $45,000: 15 cents per $1 over $18,200
• $45,001 to $135,000: $4,020 plus 30 cents per $1 over $45,000
• $135,001 to $190,000: $31,020 plus 37 cents per $1 over $135,000
• Over $190,000: $51,370 plus 45 cents per $1 over $190,000

For example, on a $80,000 salary, the tax is $4,020 plus 30% of ($80,000 – $45,000) = $4,020 + $10,500 = $14,520.

Step 3: Subtract the Medicare Levy

The Medicare levy is 2% of your taxable income for most full-time workers. However, if your income is below $28,011, you pay nothing. Between $28,011 and $35,013, you pay 10 cents per dollar over the lower threshold. Above $35,013, the full 2% applies. These are the latest published single-person thresholds. On $80,000, the levy is $1,600.

Step 4: Apply the Low Income Tax Offset (LITO)

LITO reduces your tax bill. For 2026–27, the maximum offset is $700 for incomes up to $37,500. It phases out by 5 cents per dollar up to $45,000, then by 1.5 cents per dollar up to $66,667. On $80,000, you are above $66,667, so you get no LITO.

Step 5: Calculate Your Take-Home Pay

Take your gross salary, subtract the tax (after LITO), and subtract the Medicare levy. The result is your annual take-home pay. Divide by 26 for a fortnightly amount or by 52 for a weekly amount. Remember, this is an estimate and excludes HELP/HECS, the Medicare levy surcharge, salary sacrifice, and payroll rounding.

Using a Mortgage Calculator Salary Tool

When you use a mortgage calculator salary tool, you typically enter your gross income. To get a realistic borrowing estimate, use your take-home pay instead. Lenders often look at your net income after tax and Medicare. The Tax and Medicare page has more details on how these deductions work.

Benchmark Figures for Context

Fair Work sets the national minimum wage at $26.44 per hour and $1,004.90 per week from 1 July 2026. The ABS reports that all employees average $1,579.20 per week (including part-time), and full-time adult ordinary time earnings average $2,083.70 per week. These figures help you compare your salary to the broader market.

Important Notes

• Super is not deducted from take-home if your salary is quoted as plus super.
• The Medicare levy surcharge applies if you don't have appropriate private hospital cover and earn above a threshold, but that is not covered here.
• This estimate is not a tax assessment. Always check with the ATO or a tax professional.