PAYG Withholding Calculator
This is an Australian PAYG withholding calculator. Enter gross salary or wages and the pay cycle, and it estimates the amount of tax to withhold using the ATO schedule under Schedule 1 of the Taxation Administration Act 1953 (Cth). Use it for payroll scoping and employment dispute quantification — the actual withholding depends on the employee's TFN declaration and any variations.
What this calculator does
Pay As You Go (PAYG) withholding requires employers to withhold tax from payments to employees and certain other payees. The amounts are calculated using the ATO withholding schedules published under Schedule 1 to the Taxation Administration Act 1953 (Cth). This calculator applies the standard tax-free threshold coefficients for resident employees paid on a regular cycle.
Legal basis
PAYG withholding is imposed under Schedule 1 to the Taxation Administration Act 1953 (Cth), Division 12. The withholding schedules (tax tables) are published by the ATO under s 15-25 of Schedule 1. Individual income tax rates are set in s 4-10 of the Income Tax Rates Act 1986 (Cth). The Medicare levy is imposed under the Medicare Levy Act 1986 (Cth).
How the calculation works
Annualise the gross pay (multiply by 52 for weekly, 26 for fortnightly, 12 for monthly). Apply the ATO withholding coefficients for the applicable tax table (resident with/without tax-free threshold, foreign resident, or working holiday maker). The coefficients incorporate the individual income tax rates under the Income Tax Rates Act 1986 (Cth), the Medicare levy, and the low-income tax offset. Divide the annual withholding back to the pay period. If HELP debt applies, add the compulsory repayment percentage from Schedule 1.
Interactive calculator coming soon
For a resident employee claiming the tax-free threshold with monthly gross pay of $5,000 ($60,000 annualised), estimated PAYG withholding is approximately $897 per month (including Medicare levy).
In the meantime, use the worked example above to validate your figures and confirm the final amount with the relevant revenue office or authority before relying on it in a matter.
Start free trialWhat you fill in
- Gross pay per period (AUD) (currency): Must be a positive number
- Pay cycle (select): Required
- Claims tax-free threshold? (select): Required
- HELP/HECS debt? (select): Required
- Tax residency (select): Required
Limitations
- Uses the standard ATO coefficients — does not handle withholding variations (upward or downward) lodged with the employer
- Does not model the Medicare levy surcharge for higher earners without private health insurance
- HELP repayment thresholds are indexed annually — confirm with the ATO
- Does not handle lump-sum payments, bonuses, or back-pay (different schedules apply)
- Does not calculate employer superannuation obligations (separate to withholding)
- Working holiday maker rates may differ for employers who are not registered WHM employers
What to do next
For payroll and employment matters, confirm withholding amounts with the ATO tax tables for the current financial year. In employment disputes, Quillio quantifies underpayment claims including PAYG, super, and leave entitlements — see /practice-areas/employment-lawyers.
Calculator FAQs
What is the tax-free threshold?
The tax-free threshold is $18,200 for Australian residents. An employee who claims the threshold on their TFN declaration has lower withholding because the first $18,200 of annual income is tax-free.
How does the Medicare levy work in withholding?
The ATO withholding coefficients incorporate the 2% Medicare levy. There is a low-income exemption and a phase-in range. The Medicare levy surcharge (for higher earners without private health insurance) is not included in standard withholding.
What if the employee has a HELP debt?
Compulsory HELP repayments are withheld through PAYG once the employee's income exceeds the minimum repayment threshold. The repayment rate is a percentage of total income, not just the amount above the threshold.
Are the withholding tables updated each year?
Yes — the ATO publishes updated withholding schedules each financial year reflecting any changes to tax rates, thresholds, offsets, and HELP repayment rates.
Does this cover contractor withholding?
No — this calculator is for employee withholding under Division 12. Payments to contractors may be subject to different withholding rules under voluntary agreements (Division 13) or labour hire arrangements (s 12-60).
What about foreign residents?
Foreign residents have no tax-free threshold and are taxed from the first dollar at higher marginal rates. The calculator applies the foreign resident withholding table when that option is selected.
Is this tax advice?
No — it is a withholding estimator based on the standard ATO coefficients. Actual withholding depends on the employee's TFN declaration and any variations. Consult the ATO or your adviser.
Get help with the matter
For employment lawyers, Quillio quantifies underpayment claims by combining PAYG withholding, superannuation shortfalls, and leave entitlements into a single brief-ready schedule. See /practice-areas/employment-lawyers.
This calculator uses the standard ATO withholding coefficients and does not account for individual variations, Medicare levy surcharge, or non-standard payment types. Confirm with the ATO tax tables or your payroll adviser.
Quillio handles the next steps.
The calculator gives you the number. Quillio handles the rest of the matter — drafting, review, research, and correspondence. The free trial requires no sales call.
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