How to Compare Job Offers Using Your Take-Home Salary

Comparing Job Offers by What You Actually Keep

When you receive a job offer, the headline figure is usually the annual salary. But what matters most is the amount that reaches your bank account each pay period after the Australian Taxation Office takes its share. This guide shows you how to compare offers using your take-home pay, so you can make an informed decision.

Step 1: Understand the Tax Rates for 2026–27

The Australian tax system is progressive. For the 2026–27 income year, the resident tax rates are:

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

These rates apply to your taxable income, which is your salary minus any deductions you claim. For a simple comparison, start with your gross salary.

Step 2: Add the Medicare Levy

The Medicare levy is 2% of your taxable income. However, if you earn below certain thresholds, you may pay a reduced rate or none at all. The latest published single-person Medicare thresholds are $28,011 and $35,013. If your taxable income is below $28,011, you pay no Medicare levy. Between $28,011 and $35,013, you pay 10 cents per dollar over the lower threshold. Above $35,013, you pay the full 2%. For most full-time salaries, you will pay the full 2%.

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

The Low Income Tax Offset can reduce the tax you pay. For 2026–27:

• Maximum $700 at taxable income up to $37,500, then 5 cents off per dollar until $45,000, then $325 minus 1.5 cents per dollar over $45,000 until $66,667. It can only reduce tax to zero. This offset is automatically applied by your employer's payroll system or when you lodge your tax return.

Step 4: Calculate Your Take-Home Pay

You can do this manually using the rates above, but it is easier to use the Take-home pay guide or the Clearance tool on this site. For example, a salary of $82,118 (the all-employees average weekly total earnings of $1,579.20 per week annualised) would fall into the $45,001–$135,000 bracket. Tax would be $4,020 plus 30 cents on the amount over $45,000, which is $37,118 × 0.30 = $11,135.40, total tax $15,155.40. Medicare levy at 2% is $1,642.36. LITO at that income is $325 minus 1.5 cents per dollar over $45,000: $37,118 × 0.015 = $556.77, so LITO = $325 – $556.77 = negative, so zero. Total deductions: $16,797.76. Take-home: $65,320.24 per year, or about $1,256.16 per week.

But remember, this is an estimate. It excludes HELP/HECS, the Medicare levy surcharge, salary sacrifice, and payroll tax-table rounding. It is not a tax assessment.

Step 5: Compare Offers Using Fortnightly or Weekly Figures

Most employers pay fortnightly. Divide your annual take-home by 26 to get your fortnightly amount. This is the number that will appear in your bank account every two weeks. When comparing two offers, look at the take-home pay, not just the gross salary. A higher gross salary may not always mean higher take-home if one offer includes salary packaging or if the other has a lower tax bracket due to deductions.

Step 6: Consider Superannuation

Super is not deducted from your salary. From 1 July 2026, the super guarantee rate is 12% of your ordinary time earnings, up to a maximum contribution base of $270,830 per year. Your employer pays this on top of your salary. When comparing offers, check whether the salary is quoted as "plus super" or "including super". If it is "plus super", your take-home is based on the salary figure alone. If it is "including super", the super component is part of the quoted amount, so your take-home will be lower. Always clarify with the employer.

Step 7: Use Benchmarks for Context

The Benchmarks page provides key figures:

• National minimum wage: $26.44 per hour, $1,004.90 per week, annualised $52,255 (Fair Work Ombudsman, from 1 July 2026).
• All employees average weekly total earnings: $1,579.20 per week, annualised $82,118 (ABS, May 2026, seasonally adjusted, includes part-time).
• Full-time adult ordinary time earnings: $2,083.70 per week, annualised $108,352 (ABS, May 2026, excludes overtime and employer super).

Use these to see where your offer sits relative to the market. But remember, averages include many occupations and locations.

Step 8: Factor in the Medicare Levy Surcharge and Other Deductions

This guide does not cover the Medicare levy surcharge, which applies if you do not have appropriate private hospital cover and your income exceeds certain thresholds. Also, if you have a HELP/HECS debt, repayments are deducted from your pay. These are not included in the Clearance tool estimate. For a full picture, consult the Tax and Medicare guide.

Conclusion

When comparing job offers, always convert the gross salary into your estimated take-home pay. Use the resources on this site to get a quick estimate. Remember that the figures here are for resident taxpayers only and are not a tax assessment. Your actual take-home may vary due to your personal circumstances.

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This guide uses the 2026–27 tax year rates and the latest published single-person Medicare thresholds ($28,011 and $35,013). The minimum wage is $26.44 per hour and $1,004.90 per week as set by Fair Work Ombudsman. All other figures are from the Australian Taxation Office and the Australian Bureau of Statistics.