Income Tax rates in Australia have been falling almost every year for the last 15 years. The top marginal tax rate is now 46.5% including the medicare levy and this top tax bracket kicks in at $180,000.
Average Rate of Tax for the 2011 Financial Year
The average rate of tax for the 2011 for the average employee earning $70,000 per annum is 22%. This compares to 30% in 2001.
The average rate of tax for someone on $200,000 is 33% compared to 42% ten years ago, a saving of almost $18,000 per annum.
The average rate of tax is different to the marginal rate of tax. Accountants often talk in terms of the marginal rate of tax, being the rate of tax if you earned an additional $1 in income. The marginal rate of tax is important in determining the cost or benefit of a particular transaction.
Table of Average Tax Rates for 2011 Financial Year
| 2011 Income Tax Rates | ||
| Income | Total Income Tax (Inc. Medicare Levy at 1.5%) | Average Rate of tax |
| 10,000 | - | 0.00% |
| 20,000 | 821 | 4.10% |
| 30,000 | 2,550 | 8.50% |
| 40,000 | 5,050 | 12.63% |
| 50,000 | 8,600 | 17.20% |
| 60,000 | 12,150 | 20.25% |
| 70,000 | 15,600 | 22.29% |
| 80,000 | 18,750 | 23.44% |
| 90,000 | 22,600 | 25.11% |
| 100,000 | 26,450 | 26.45% |
| 110,000 | 30,300 | 27.55% |
| 120,000 | 34,150 | 28.46% |
| 130,000 | 38,000 | 29.23% |
| 140,000 | 41,850 | 29.89% |
| 150,000 | 45,700 | 30.47% |
| 160,000 | 49,550 | 30.97% |
| 170,000 | 53,400 | 31.41% |
| 180,000 | 57,250 | 31.81% |
| 190,000 | 61,900 | 32.58% |
| 200,000 | 66,550 | 33.28% |
| 210,000 | 71,200 | 33.90% |
| 220,000 | 75,850 | 34.48% |
| 230,000 | 80,500 | 35.00% |
| 240,000 | 85,150 | 35.48% |
| 250,000 | 89,800 | 35.92% |
Note: Average Rate of Tax is Total Tax divided by Taxable Income.
You can use our quick and simple to use Income Tax Calculator to calculate your Australian income tax for any year between 2001 and 2011.
| Arnold Shields is a Director of Dolman Bateman & Co Pty Ltd, Forensic Accountants and Chartered Accountants. He specialises in forensic accounting and business advice. |
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