Question 1

How is Australian income tax calculated?

Accepted Answer

Australian income tax for residents uses progressive brackets for 2025-26: $0-$18,200 (0% - tax-free threshold), $18,201-$45,000 (16%), $45,001-$135,000 (30%), $135,001-$190,000 (37%), and over $190,001 (45%). Non-residents pay tax from the first dollar at rates from 30% to 45% without the tax-free threshold.

Question 2

What is the Medicare Levy?

Accepted Answer

The Medicare Levy is a 2% tax on taxable income that funds Australia's public healthcare system. It applies to Australian residents only. Low-income earners may receive an exemption or reduction. Non-residents for tax purposes do not pay the Medicare Levy.

Question 3

How do HELP/HECS repayments work?

Accepted Answer

HELP (Higher Education Loan Program) and HECS (Higher Education Contribution Scheme) repayments are compulsory once your income exceeds $54,435 (2025-26). Repayment rates range from 1% to 10% based on income brackets. The repayment is deducted from your pay by your employer through PAYG withholding.

Question 4

What is superannuation and how does it work?

Accepted Answer

Superannuation (super) is Australia's retirement savings system. Your employer must contribute 12% of your ordinary time earnings to your super fund. This is on top of your salary and doesn't reduce your take-home pay. The money is invested and typically can't be accessed until retirement age (currently 60).

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