How Much Tax Do You Pay on a Pay Rise?
A simple guide to estimating the after-tax value of a raise in Australia.
Compare old salary and new salary
Run both salaries through the calculator and compare the difference in take-home pay. That is clearer than trying to estimate the raise from the gross increase alone.
HELP debt can change the result
A pay rise can move repayment income into a higher HELP repayment band, which may reduce the apparent gain in bank-account pay.
Super may be separate
If your raise is quoted as a package increase, confirm whether the extra amount includes employer super.
Common questions
Does a pay rise reduce my take-home pay?
A normal pay rise should increase take-home pay, but tax and repayments can mean the increase is smaller than the headline amount.
Is a pay rise taxed like a bonus?
Final annual tax is based on total income. Payroll withholding timing can differ, especially for bonuses.