PAYG Withholding Calculator Australia — Weekly Tax Withheld 2026
Real-World Examples — 2026
Full-time employee — $85,000/year, fortnightly
An employee earning $85,000/year paid fortnightly ($3,269/fortnight), claiming the tax-free threshold, with no HECS debt. PAYG tax withheld per fortnight is approximately $720. Annual tax withheld: $18,720, closely matching the annual income tax liability of $18,672 (difference settled at tax return time).
Second job (no threshold claim) — $600/week
An employee earning $600/week at a second job who does not claim the tax-free threshold (already claimed at primary employer). PAYG withholding is calculated at the higher 'no tax-free threshold' rates. Estimated weekly withholding: approximately $180, reflecting a higher effective rate since no threshold is applied.
Frequently Asked Questions
What is PAYG withholding in Australia?
PAYG (Pay As You Go) withholding is the system by which employers deduct income tax from employee wages each pay period and remit it to the ATO on the employee's behalf. It is similar to Pay As You Earn (PAYE) systems in the UK and other countries. The amount withheld is calculated using the ATO's weekly, fortnightly, or monthly withholding tax tables.
What happens if too much or too little tax is withheld?
If too much tax is withheld, you receive a refund when you lodge your tax return. If too little is withheld (e.g. you have multiple jobs or investment income not subject to withholding), you will owe a tax debt when you lodge. The ATO charges the Shortfall Interest Charge (SIC) on underpayments. It is the taxpayer's responsibility to ensure sufficient tax is paid.
Can I vary my PAYG withholding?
Yes. You can ask your employer to withhold additional amounts (by lodging a withholding variation) if, for example, you have investment income not subject to withholding. You can also apply to the ATO to vary withholding downward if you have large deductions — for example, significant investment property losses — to avoid waiting until year-end for a refund.
How does having a HECS-HELP debt affect my pay?
If your taxable income exceeds the minimum HECS repayment threshold ($54,435 in FY2025–26), your employer must withhold an additional HECS repayment amount from each pay. You indicate this on your TFN declaration or by contacting your payroll. The repayment rate ranges from 1% at the threshold to 10% on incomes above $151,201. The withheld amount goes directly to reduce your HECS balance.
Do I need to lodge a tax return if my employer withholds the correct tax?
Most Australian employees must still lodge a tax return, even if the correct amount was withheld. You may be entitled to deductions (work-related expenses, charitable donations, income protection premiums) that reduce your taxable income and result in a refund. You must also report interest, dividend, and rental income. The ATO pre-fills much of this data via its myTax system.