Your take-home pay under the new minimum wage 2026

What the new minimum wage 2026 means for your take-home pay

If you’re an Australian employee on the national minimum wage, you want to know exactly what lands in your bank account after tax and the Medicare levy. The new minimum wage 2026 – effective from 1 July – is set by the Fair Work Commission at $26.44 an hour or $1,004.90 a week for a full‑time 38‑hour week. That’s an annual salary of $52,255 before any deductions.

But the figure you see on your payslip is not what you take home. Here’s how a resident works out the after‑tax amount, using the latest tax rates and offsets.

Step 1: Know your gross pay

The national minimum wage applies if you’re not covered by an award or enterprise agreement. Most employees are covered by an award, which often pays more. Check your award using the Minimum wage guide. For this example, we’ll use the $52,255 annual figure.

Step 2: Calculate income tax

For the 2026–27 tax year, the Australian Tax Office applies these rates to residents:

• $0 – $18,200: Nil
• $18,201 – $45,000: 15c for each $1 over $18,200
• $45,001 – $135,000: $4,020 plus 30c for each $1 over $45,000

On $52,255, your tax is:

• Nil on first $18,200
• 15c on $26,800 ($18,201 to $45,000) = $4,020
• 30c on $7,255 ($45,001 to $52,255) = $2,176.50
• Gross tax = $6,196.50

Step 3: Apply the Low Income Tax Offset (LITO)

LITO reduces your tax bill. For 2026–27:

• Maximum $700 if taxable income is $37,500 or less
• Then reduces by 5c per $1 until $45,000
• From $45,001 to $66,667: $325 minus 1.5c per $1 over $45,000

Your LITO = $325 – 1.5c × ($52,255 – $45,000) = $325 – $108.83 = $216.17

Tax after LITO = $6,196.50 – $216.17 = $5,980.33

Step 4: Add the Medicare levy

The Medicare levy is 2% of your taxable income. For a full‑time worker, you pay the full 2% because your income is above the single thresholds ($28,011 and $35,013).

• Medicare levy = 2% × $52,255 = $1,045.10

Step 5: Your take‑home pay

Total deductions = $5,980.33 (tax) + $1,045.10 (Medicare) = $7,025.43

Annual take‑home = $52,255 – $7,025.43 = $45,229.57

• Weekly: $45,229.57 ÷ 52 = $869.80
• Fortnightly: $45,229.57 ÷ 26 = $1,739.60

This is an estimate. It does not include HELP/HECS repayments, the Medicare levy surcharge, salary sacrifice, or payroll rounding. Use the Take-home pay calculator for your exact situation.

What about superannuation?

The minimum wage is before super. From 1 July 2026, your employer must pay 12% super on top of your ordinary time earnings. That’s an extra $6,270.60 per year going into your super fund – it does not reduce your take‑home pay. If a job ad says “$26.44 per hour”, super is additional.

Casual employees

If you’re a casual worker entitled to the national minimum wage, you must receive a 25% casual loading: $33.05 per hour. Your annual gross pay would be higher, and your take‑home will increase accordingly. The same tax and Medicare rules apply.

Award‑covered employees

Most employees are covered by an award. The Fair Work Ombudsman confirms that award minimum wages increased by 4.75% from 1 July 2026, with the lowest ongoing rate at least $26.44 per hour. Your actual rate may be higher. Check your award using the Tax and Medicare guide to understand how penalties and allowances affect your net pay.

Key points to remember

• The new minimum wage 2026 is $26.44 per hour / $1,004.90 per week.
• Take‑home for a full‑time resident is about $870 per week.
• Super is paid on top, not deducted from your wage.
• Medicare thresholds ($28,011 and $35,013) mean full‑time workers pay the full 2% levy.
• This is a guide only – your actual tax may vary due to your circumstances.

For a personalised calculation, use the Clearance tool on this site. It applies the latest ATO rates and offsets to give you a reliable take‑home estimate.