Resident tax rates 2020 21 taxable income tax on this income 0 18200 nil 18201 45000 19 cents for each 1 over 18200 45001 120000 5092 plus 325 cents for each 1 over 45000 120001 180000 29467 plus 37 cents for each 1 over 120000 180001 and over 51667 plus 45 cents for each 1 over 180000. Australia has what is called is a progressive tax system that means the higher your income the higher the rate of tax you need to pay our lowest tax rate is 19 and this kicks in on the first dollar you earn over the tax free threshold our highest tax rate is 47 but this is only charged on income over 180000 and most people pay somewhere in between. 2021 guide to tax deductions in australia in this austrlia tax guide we examine the different tax deductions and expenses which should be accounted for when completing a tax return to ensure you pay the right amount of tax and claim back your money for expenses which are tax deductable how do tax deductions work in australia. Australia income tax and salary guides income tax can seem like a minefield sometimes and trying to understand how your wages and salary are calculated can be very frustrating most people accept the need to pay taxes and can see the social benefits of a system that pools collective funds. Australian tax rates 2015 16 for resident individuals in australia tax is levied on worldwide income on a progressive basis referred to as marginal tax rates your marginal tax rates shown in the following table can vary between 0 per cent and 45 per cent the more income you earn the greater the amount of tax youre liable to pay