PAYG withholding calculator 2026-27
Work out how much tax to withhold from an employee's pay in Australia, using the ATO's Schedule 1 formulas for payments from 1 July 2026. It also covers the study and training loan (HELP, VSL, SSL, AASL) component from Schedule 8, tax offsets, and the extra for years with 53 weekly or 27 fortnightly paydays. It's tested against every figure in the ATO's own sample data.
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CalculatorWorked examplesWhich scale?What it doesn't coverFAQ
Worked examples (2026-27)
Each example below is one of the ATO's published test figures. The calculator reproduces all of them exactly.
| Pay | Situation | Working | Withhold |
|---|---|---|---|
| $1,135 weekly | Tax-free threshold claimed (scale 2) | x = 1,135.99; y = 0.3227 × 1,135.99 − 185.1935 = 181.39 | $181 |
| $3,690 fortnightly | Scale 2 | Weekly equivalent 3,690 ÷ 2 = 1,845; x = 1,845.99; y = 0.32 × x − 181.7319 = 408.98 → $409; × 2 | $818 |
| $4,034.33 monthly | Scale 2 | Ends in 33c, so add 1c: 4,034.34 × 3 ÷ 13 = 931.00 → $931; x = 931.99; y = 0.3227 × x − 185.1935 = 115.56 → $116; × 13 ÷ 3 = 502.67 | $503 |
| $1,845 weekly | Tax-free threshold NOT claimed (scale 1) | x = 1,845.99; y = 0.32 × x − 71.6508 = 519.07 | $519 |
| $2,608.36 weekly | Scale 2 with a HELP debt | Schedule 1: 0.39 × 2,608.99 − 363.4627 = 654.04 → $654. Study loan component (Schedule 8): 0.17 × 2,608.99 − 250.4527 = 193.08 → $193 | $847 |
| $1,344 fortnightly | Foreign resident (scale 3) | Weekly equivalent 672; x = 672.99; y = 0.30 × x − 0.30 = 201.60 → $202; × 2 | $404 |
How the ATO formula works
- Convert to a weekly figure. Fortnightly: halve it. Monthly: if it ends in 33 cents add 1 cent, then multiply by 3 and divide by 13. Quarterly: divide by 13. Drop the cents.
- Add 99 cents to get x, then apply y = ax − b using the coefficients for the employee's scale and earnings range.
- Round to the nearest dollar (50 cents rounds up). Don't round to cents first.
- Convert back: × 2 for fortnightly; × 13 ÷ 3, rounded to the nearest dollar, for monthly; × 13 for quarterly.
- Tax offsets (scales 2, 5 and 6 only) reduce the amount by 1.9% (weekly), 3.8% (fortnightly), 8.3% (monthly) or 25% (quarterly) of the yearly offsets claimed, rounded to the nearest dollar.
- Study and training loans: the Schedule 8 component is worked out the same way and added on. With the tax-free threshold claimed, it starts at $1,337 a week ($2,674 a fortnight, $5,793.67 a month). Without it, it starts at $987 a week.
Which scale applies?
| Scale | Use it when the employee… |
|---|---|
| 1 | is an Australian resident who did not claim the tax-free threshold (usually a second job) |
| 2 | is an Australian resident who claimed the tax-free threshold (most main jobs) |
| 3 | is a foreign resident for tax purposes (no tax-free threshold, no Medicare levy) |
| 4 | hasn't given you their TFN (after the 28-day grace period): 47%, or 45% for a foreign resident |
| 5 | claimed a full Medicare levy exemption on a Medicare levy variation declaration |
| 6 | claimed a half Medicare levy exemption |
Extra withholding in a 53-pay or 27-pay year
Some years have 53 weekly or 27 fortnightly paydays, so the normal amounts under-withhold slightly. The ATO's suggested extra amounts are below. Employees can ask for them (the calculator adds them when you tick the box).
| Weekly earnings | Extra | Fortnightly earnings | Extra |
|---|---|---|---|
| $875 to $2,574 | $3 | $1,700 to $5,199 | $12 |
| $2,575 to $3,649 | $7 | $5,200 to $7,249 | $27 |
| $3,650 and over | $12 | $7,250 and over | $48 |
What this calculator doesn't cover
- Working holiday makers (Schedule 15), seasonal workers, and employees who claimed a Medicare levy reduction for a spouse or dependants (Medicare levy adjustment).
- Bonuses, commissions and back payments paid separately (Schedule 5 marginal method), termination payments and unused leave on termination.
- Seniors and pensioners: enter their offset amount in the tax offsets box if they've claimed it on their withholding declaration.
- Payments to contractors. Only withhold from contractors under a voluntary agreement (a flat 5%) or when there's no ABN (47%). This calculator is for employees.
For anything else, use the ATO's own Tax withheld calculator or ask a registered tax or BAS agent.
FAQ
How do I calculate PAYG withholding for 2026-27?
Convert the pay to a weekly figure, drop the cents and add 99 cents (x). Then apply y = ax − b with the ATO Schedule 1 coefficients for the employee’s scale, round to the nearest dollar and convert back to the pay period. This calculator does all of that and shows the a and b it used.
How much tax is withheld from $1,000 a week?
For an Australian resident who claimed the tax-free threshold (scale 2), $1,000 a week means $138 withheld for payments from 1 July 2026 (x = 1,000.99, and 0.3227 × 1,000.99 − 185.1935 = 137.83, rounded to the nearest dollar). Check it above: amounts depend on the scale, a HELP debt and any tax offsets.
What is the difference between scale 1 and scale 2?
Scale 2 is for employees who claimed the tax-free threshold, usually in their main job. Scale 1 is for those who didn’t, usually a second job, so tax is withheld from the first dollar.
Do I withhold extra for an employee with a HELP debt?
Yes, if they said so on their TFN declaration. The Schedule 8 study and training support loan component is added on top. From 1 July 2026 it starts at $1,337 a week for employees who claimed the tax-free threshold, and $987 a week for those who didn’t.
Are these the new rates from 1 July 2026?
Yes. The coefficients come from Schedule 1 and Schedule 8 for payments made from 1 July 2026, published by the ATO on 17 June 2026. They reflect the 15% bottom tax rate for 2026-27.
Why is the monthly amount not exactly the weekly amount × 52 ÷ 12?
The ATO converts monthly pay to a weekly figure (× 3 ÷ 13), rounds that weekly withholding, then multiplies by 13 ÷ 3 and rounds again. That is the official method, so it can differ by a dollar from other shortcuts.
How much do I withhold if the employee hasn’t given me their TFN?
Use scale 4: 47% of the payment (45% for a foreign resident), ignoring cents. No HELP component or tax offsets apply. Employees normally have 28 days to give you their TFN declaration before this applies.
Where do I report the amounts?
Gross wages go at W1 and amounts withheld at W2 on your BAS, and each pay is reported through Single Touch Payroll. You pay the withheld amounts to the ATO by your BAS or PAYG withholding due date.
Sources (checked 17 Oct 2026): ATO Schedule 1 – Statement of formulas for calculating amounts to be withheld (NAT 1004, payments from 1 July 2026, published 17 June 2026) and its withholding amounts sample data; Schedule 8 – Statement of formulas for calculating study and training support loans components (NAT 3539, published 17 June 2026); Study and training loan repayment income and rates (updated 13 Oct 2026).
General information, not tax advice. This follows the ATO's published formulas, but you're responsible for what you withhold. Check unusual cases with the ATO or a registered tax or BAS agent.
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