Compare job offers with the ATO salary sacrifice calculator: what reaches your bank account

Why after-tax pay matters when comparing job offers

When you receive a job offer, the headline salary can be misleading. What really matters is the amount that reaches your bank account after income tax and the Medicare levy. A higher gross salary might not always leave you better off if one offer includes salary sacrifice options that reduce your taxable income. This guide shows you how to use the ATO salary sacrifice calculator to compare offers on an after-tax basis.

Understanding your tax and Medicare

For the 2026–27 income year, Australian residents pay no tax on the first $18,200. Above that, rates are:

• 15c per dollar from $18,201 to $45,000
• 30c per dollar from $45,001 to $135,000
• 37c per dollar from $135,001 to $190,000
• 45c per dollar over $190,000

You also pay the Medicare levy at 2% of your taxable income. The latest published single-person Medicare thresholds are $28,011 and $35,013 – if your taxable income is below $28,011 you pay no levy; between $28,011 and $35,013 you pay a reduced rate. Full-time salaries almost always exceed these thresholds, so you will pay the full 2%.

The Low Income Tax Offset (LITO) can reduce your tax by up to $700 if your taxable income is below $37,500, phasing out by $66,667. This is automatically applied by your employer in withholding.

How salary sacrifice changes the picture

Salary sacrifice (also called salary packaging) lets you swap part of your pre-tax salary for benefits like a car, laptop, or additional super contributions. Because your taxable income drops, you pay less income tax and Medicare levy. The ATO provides a detailed example on its website showing how salary sacrifice can increase net disposable income even after employee contributions.

For instance, an employee earning $65,000 who salary sacrifices $17,353 for a car (without employee contributions) reduces taxable income to $47,647, saving about $5,200 in tax and Medicare compared to no packaging. With a $7,000 employee contribution, net disposable income rises further. The Australian Taxation Office shows these calculations in its salary sacrificing guide.

To model your own situation, use the ATO salary sacrifice calculator (available via the ATO’s tax withheld calculator). You enter your gross pay, any salary sacrifice amounts, and your pay frequency. The calculator returns the tax to withhold and your net pay. This is the figure that will actually be deposited into your account each fortnight.

Comparing offers: step by step

1. Get the gross annual salary from each offer. If the offer says “plus super”, the 12% super guarantee is on top – your take-home is based on the salary figure alone.
2. Check if salary sacrifice is available. Some employers offer packaging for cars, laptops, or super. If yes, ask for the maximum amount you can sacrifice and any employee contributions required.
3. Use the ATO salary sacrifice calculator to estimate your net pay. Enter your taxable income after the sacrifice, and the calculator will show the tax and Medicare withheld.
4. Add back any benefits you would otherwise pay for out-of-pocket. For example, if you would spend $11,500 a year on car expenses without packaging, factor that saving in.
5. Compare the net disposable income – what you keep after tax, Medicare, and any employee contributions. The offer with the higher net figure is better for your wallet.

Benchmarks to guide your expectations

• The national minimum wage from 1 July 2026 is $26.44 per hour and $1,004.90 per week, equating to about $52,255 annually. After tax and Medicare, a single person earning this amount takes home roughly $43,000 per year (depending on LITO).
• The average full-time adult ordinary time earnings are $2,083.70 per week or $108,352 annually (excluding overtime and employer super). After tax and Medicare, that yields about $79,000 take-home.
• Part-time and all-employees averages are lower – see our Benchmarks page for details.

Remember that super is not deducted from your take-home pay if the offer is “plus super”. The 12% super guarantee is paid by your employer on top of your salary. If an offer says “salary inclusive of super”, then part of your gross pay goes to super, reducing your take-home.

Other factors that affect your net pay

• Study and training loan repayments (HELP, VSL, etc.) – if you have a debt, your employer withholds extra tax. The ATO tax withheld calculator includes this.
• Medicare levy surcharge – if you earn over $93,000 (single) and don’t have private hospital cover, you pay an extra 1% to 1.5%.
• Tax offsets – LITO is the main one for low earners; others may apply.

The calculators from the ATO and Moneysmart can handle most of these. For a full picture, use the Take-home pay guide on this site.

Final advice

Always compare job offers on the basis of what you will actually receive in your bank account each fortnight. The ATO salary sacrifice calculator is your best tool for modelling salary packaging scenarios. And don’t forget to consider non-salary factors like location, career growth, and work-life balance. For more on salary packaging, see our Salary packaging topic page.