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How to Evaluate a Salary Offer in Australia — What the Number Really Means
When you receive a job offer in Australia, the salary figure quoted is almost never what you will actually receive in your bank account. Between income tax, the Medicare Levy, HECS-HELP repayments, and the interaction with your superannuation, the difference between a $90,000 and a $100,000 offer may be much smaller — or larger — than it first appears.
Understanding how to calculate your true take-home pay is essential for making an informed career decision and for negotiating effectively.
Australian Income Tax Rates 2025–26
Australia uses a progressive income tax system, meaning you pay a higher rate only on the portion of your income above each threshold — not on your entire salary.
| Taxable Income | Tax Rate | Tax Payable on This Bracket |
|---|---|---|
| $0 – $18,200 | 0% | Nil |
| $18,201 – $45,000 | 19% | $0 + 19c for each $1 over $18,200 |
| $45,001 – $135,000 | 32.5% | $5,092 + 32.5c for each $1 over $45,000 |
| $135,001 – $190,000 | 37% | $34,342 + 37c for each $1 over $135,000 |
| $190,001+ | 45% | $54,742 + 45c for each $1 over $190,000 |
Plus 2% Medicare Levy on most incomes (reduced or exempt for very low incomes). Low Income Tax Offset (LITO) of up to $700 reduces the tax payable for incomes below $66,667.
The Super Question: Is it "Including" or "On Top of" Salary?
One of the most common sources of confusion when comparing Australian job offers is superannuation. There are two ways a salary can be quoted:
- Base salary + super: You receive the quoted salary, and the employer pays an additional 12% on top. So "$85,000 + super" means you get $85,000 in wages AND $10,200 goes into your super fund.
- Total remuneration package (TRP): The super is included within the quoted figure. So "$95,000 TRP" means your base salary is $84,821 and $10,179 goes to super.
Always clarify before accepting. A "$95,000 TRP" offer is actually worth LESS than an "$85,000 + super" offer. Always ask: "Is super included in or on top of that salary?" The difference can be over $10,000 per year in take-home pay.
HECS-HELP Repayments — How They Reduce Your Take-Home Pay
If you have a HECS-HELP student loan, repayments are made automatically through your tax return based on your income. For 2025–26, repayments start once your income exceeds $54,435:
| Repayment Income | Repayment Rate | Annual Repayment on $80K income |
|---|---|---|
| Below $54,435 | Nil | — |
| $54,436 – $62,738 | 1.0% | — |
| $62,739 – $66,529 | 2.0% | — |
| $66,530 – $70,539 | 2.5% | — |
| $70,540 – $74,980 | 3.0% | — |
| $74,981 – $79,612 | 3.5% | — |
| $79,613 – $84,753 | 4.0% | ~$3,200 |
| $84,754 – $90,076 | 4.5% | — |
| $90,077 – $95,680 | 5.0% | — |
On an $80,000 salary with HECS, you'd pay approximately $3,200/year in HECS repayments — meaning a pay rise from $79,000 to $81,000 actually reduces your take-home pay if it pushes you into the next HECS bracket. Our calculator accounts for this.
How to Negotiate Your Salary in Australia
1. Know your market rate before you negotiate
Use resources like SEEK Salary Insights, LinkedIn Salary, and industry salary surveys to understand what people in your role and location are actually earning. Walking into a negotiation without this data puts you at a significant disadvantage.
2. Negotiate on total package, not just base salary
If the employer won't move on base salary, ask about additional super contributions, extra leave, flexible working arrangements, professional development allowances, or novated leasing. These benefits can be worth thousands in pre-tax value.
3. The power of compound salary increases
A $5,000 pay rise today is worth far more than it appears. Assuming 3% annual increases, that $5,000 compounds over a career to create a significantly higher lifetime earnings base. Accepting a lower salary at one employer sets your baseline for future negotiations at that organisation.
Rule of thumb: If you're offered a job at a different company, it typically costs you 20–30% more to replace a valued employee than to give them a raise. If you have a competing offer, your current employer almost certainly has room to move — it's worth asking.
Tax calculations are based on 2025–26 ATO rates and standard assumptions. Individual results may vary. This is not financial or tax advice. For personalised advice, consult a registered tax agent.