Take home pay is the amount remaining from gross income after income tax, Medicare Levy, and any HECS-HELP repayments are deducted. Understanding your actual take home pay helps with budgeting, financial planning, and assessing the real value of salary offers and pay increases.
The gap between gross salary and take home pay can be surprising, particularly for higher income earners. An individual earning $120,000 gross takes home significantly less than two-thirds of that amount once income tax, Medicare Levy, and any HECS repayments are accounted for.
Salary packaging and salary sacrifice arrangements can increase effective take home pay for some employees by reducing taxable income. Employees of certain not-for-profit organisations can access particularly generous salary packaging benefits.
Take home pay calculations differ for self-employed individuals and contractors who must also set aside funds for quarterly PAYG tax instalments and GST obligations.
Calculations based on ATO income tax rates and thresholds for 2025-26. Medicare Levy at 2 percent. Updated annually.