How much tax do I pay on a bonus in Australia?

A bonus is taxed at your marginal tax rate, because it stacks on top of your regular income. If your income sits in the 30% bracket, a bonus is effectively taxed at about 32% including the 2% Medicare levy — and more if it pushes you into a higher bracket or you have a HECS debt. It's not a special 'bonus tax'; it's normal tax on the extra dollars.

Why was so much tax taken out of my bonus?

Employers often withhold bonus tax using the ATO's lump-sum withholding method, which can withhold more than your actual marginal rate. The good news is it's not lost — any over-withholding comes back as a larger refund when you lodge your tax return. The calculator above shows your real tax on the bonus, not just what's withheld.

Can I reduce the tax on my bonus?

A common approach is to salary sacrifice some or all of the bonus into super before it's paid, where it's taxed at 15% instead of your marginal rate — provided you stay under the concessional contributions cap ($30,000 for 2025-26). Making deductible expenses or contributions in the same year can also help. Talk to your employer before the bonus is paid, as it usually can't be changed afterwards.

Bonus Tax Calculator

Work out how much tax you'll pay on a work bonus — and what actually lands in your pocket. It also explains why bonuses feel so heavily taxed.

Last verified: 5 May 2026

How much tax will I pay on my bonus?

A bonus is taxed at your marginal rate because it sits on top of your normal pay — so it feels brutal, but it's just regular tax on the extra dollars. Your employer may withhold extra; you get any over-withholding back at tax time. Source: ATO.

Worked example. On $90,000 with a $10,000 bonus, the extra tax is about $3,200 (≈32% incl. Medicare), so you keep roughly $6,800. Sacrificing the bonus into super (taxed 15%) would keep far more of it.

General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.

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