Tax Facts

Small Business Tax

Below is a range of useful tax rates for small and medium sized businesses that apply for the 2026-27 year including:

- individual marginal tax rates

- company tax rates

- reasonable domestic and overseas travel allowance amounts

- acceptable amounts for goods taken from stock for private use by business owners

- motor vehicle thresholds

- motor vehicle cents per kilometre rate

- concessional and non-concessional superannuation contributions limits

- other superannuation thresholds

- GST thresholds

Resident Individual Tax Rates - 2026-2027 year 

TAXABLE INCOME	TAX ON THIS INCOME
$0 – $18,200	Nil
$18,201 – $45,000	15c for each $1 over $18,200
$45,001 – $135,000	$4,020 plus 30c for each $1 over $45,000
$135,001 – $190,000	$31,020 plus 37c for each $1 over $135,000
Over $190,000	$51,370 plus 45c for each $1 over $190,000
Compulsory superannuation rate: 12% from 1 July 2025

Notes on tax rates

- Taxable income includes capital gains.

- Medicare levy is imposed at the rate of 2% of taxable income is not included.

- Resident individuals are entitled to a refund of imputation credits that exceed the primary tax payable.

- Resident individuals are entitled to the 50% discount on the disposal of assets that are held for at least 12 months.

Reasonable Travel Allowance Claims for Domestic & Overseas Travel

Where an employee, company director, or office holder receives an allowance for travel costs within or outside Australia and the person makes a claim for the costs of accommodation, food, drink and incidental expenses up to certain limits, then the person is not required to keep written evidence (i.e. receipts) of the expenses. These deduction limits are based on the salary of the person and the destination of the trip.

The travel must be for business purposes and the person must be sleeping away from home. Note this concession does not apply to self employed persons, including partners in a partnership.

Click here and then scroll down to access the reasonable travel allowance claims within Australia for 2026/27

Click here and then scroll down to access the reasonable travel allowance claims within Australia for 2025/26

Goods Taken from Stock for Private Use by Business Owners

The ATO each year issues a Determination which outlines the amounts that are acceptable as estimates of the value of goods taken from trading stock for private use by business owners (including their associates) in certain industries who operate as sole traders or in partnership. The relevant amounts need to be included in the assessable income of the individual for the year.

Note that an adjustment for the GST credits claimed in relation to these amounts also needs to be made.

Fringe benefits tax and a different set of valuation rules apply where the business owner is employed through a company or family trust.

Click here and then scroll down to access the acceptable amounts for 2025/26

Click here and then scroll down to access the acceptable amounts for 2024/25

Company Tax Rates

The standard company tax rate is 30%.

From the 2017–18 income year, companies that are base rate entities must apply the lower company tax rates (see below table).

A base rate entity is a company that both:

- has an aggregated turnover less than the aggregated turnover threshold  - which is $50 million from the 2018-19 year onwards

- 80% or less of assessable income is base rate entity passive income (e.g. interest, dividends, rent, and net capital gains). 

Income Year	Applicable Turnover Threshold ($)	Company Tax Rate (%)
2017-18	25 million	27.5
2018-19	50 million	27.5
2019-20	50 million	27.5
2020-21	50 million	26.0
2021-22 and future years	50 million	25.0

Notes

Companies are required to maintain a franking account on a tax paid basis and are not entitled to a refund of imputation credits that exceed the tax payable.

Companies are not entitled to the 50% discount on the disposal of assets that are held for at least 12 months.

PAYG Withholding Calculator

This calculator is provided by the Australian Taxation Office and determines the PAYG Withholding for an employee who is paid either weekly, fortnightly or monthly.

Click here to access the calculator.

Motor Vehicle Thresholds

(i)  Cost limit for tax purposes

Since 1980, the depreciation deduction for cars has been limited by a deemed maximum cost price depending on the year in which the car was acquired.

Income Year	Depreciation Cost Limit $
2018	57,581
2019	57,581
2020	57,581
2021	59,136
2022	60,733
2023	64,741
2024	68,108
2025 & 26	69,674
2027	69,883

Maximum GST credit: $6,334 ($69,883/11). 

(ii)  Luxury car tax (LCT) thresholds - 2025 and 2026 financial years

For fuel-efficient vehicles (including electric cars), the threshold is $91,661. 

For all other luxury vehicles, the threshold is set at $80,809. 

For the 2026–27 financial year, a vehicle is defined as fuel-efficient for Luxury Car Tax (LCT) purposes if its combined fuel consumption does not exceed 3.5 litres per 100 kilometres. 

(iii) Per Kilometre Motor Vehicle Rates

These rates are used by individuals when making a claim for motor vehicle expenses up to a maximum of 5,000 business kilometres. They are also used by employers when reimbursing employees for business use of their vehicles.

2021/22 Year:    72 cents per kilometre

2022/23 Year:    78 cents per kilometre

2023/24 Year:    85 cents per kilometre

2024/25 Year:    88 cents per kilometre

2025/26 Year:    91 cents per kilometre

Taxation of Complying Superannuation Funds

Superannuation funds are taxed a rate of 15% on taxable income which includes employer contributions and the deductible portion of self employed contributions. Funds are entitled to a one-third discount on the disposal of assets that are held for at least 12 months and are also entitled to a refund of imputation credits that exceed the tax payable.

Income tax is not payable by the fund on income and capital gains where pensions are paid to the members.

There is currently a $2.1 million cap (applies from the 2026-27 year) being the the total amount of superannuation that can be transferred into the retirement phase. The excess over the cap will need to be withdrawn by the member or maintained in an accumulation phase account where earnings are taxed at the rate of 15%.  

Division 296 Tax

From 1 July 2026, Division 296 imposes an additional personal tax on the earnings of superannuation balances exceeding:

• $3 million to $10 million: An additional 15% tax on earnings (bringing the effective rate to 30%).
• Over $10 million: An additional 25% tax on earnings (bringing the effective rate to 40%).

This tax is assessed to the individual (rather than the super fund) and applies only to realised earnings. The first assessments will be issued following the conclusion of the 2026–27 financial year.

Superannuation Contributions Work Test 

Individuals who are aged between 67 to 74 years old are able to make non-concessional and salary sacrificed contributions without meeting the work test, subject to the existing contribution caps (refer below). 

However the work test will need to be satisfied for individuals aged between 67 and 74 to claim a deduction for personal concessional contributions. The work test requires an individual to work a minimum of 40 hours in a 30 consecutive day period at any time during the financial year.   

Personal concessional or non-concessional contributions can be accepted up to 28 days after the month in which the person reaches the age of 75. 

Work Test Exemption

If you are aged 67 to 74 and do not meet the standard work test, you may be eligible to use the work test exemption to claim a deduction, provided you meet three specific criteria:

1. You satisfied the work test in the previous financial year.
2. Your total superannuation balance was less than $300,000 on the previous 30 June.
3. You have not previously used the work test exemption in another financial year (it is a one-off exemption)

Concessional Superannuation Contribution Limits

Non-Concessional Superannuation Contribution Limits

The general non-concessional (after-tax) contributions cap  2026-27 year is $130,000 per year and $390,000 under the 3 year bring-forward rule.

The following table outlines the non concessional contribution and the bring forward amounts available from 1 July 2026: 

Total superannuation balance on 30 Jubne 2026	Non concessional contribution and bring forward available
Less than $1.84 million	Access up to $390,000 cap (over three years)
$1.84 million to less than $1.97 million	Access up to $260,000 cap (over two years)
$1.97 million to less than $2.1 million	Access up to $130,000 (no bring-forward period, general non-concessional contributions cap applies)
$2.1 million or more	Nil

The total superannuation balance is determined on 30 June of the previous financial year.

Other Superannuation Thresholds for the 2026–27 Financial Year

• Super guarantee (SG) rate – 12% of ordinary time earnings (no change from 2025–26).
• Maximum super guarantee contributions base – If you have paid $270,830 of qualifying earnings to an employee for the 2026–27 year, you do not need to make super guarantee contributions for that employee for any additional qualifying earnings paid to them for the remainder of the financial year.
• Capital Gains Tax Small Business contributions cap – $1,935,000 (increased from $1,865,000). This is a lifetime cap on non-concessional contributions arising from the small business 15-year exemption or retirement exemption. These contributions do not count towards the individual's non-concessional contributions cap.
• Low rate cap amount – $260,000 (no change from 2025–26) This is the lifetime limit on the taxable component of eligible super lump sums that can receive a concessional rate of tax for individuals who have reached preservation age but are under age 60. The cap is reduced by any amount previously used. 
• Government Super Co-contribution lower income threshold – $49,213 (increased from $47,488). Individuals with total income at or below this amount who make an eligible after-tax contribution may qualify for the maximum government co-contribution of $500.
• Government Super Co-contribution higher income threshold – $64,293 (increased from $62,488). Individuals with total income above this amount are not entitled to a government co-contribution.
• Low Income Super Tax Offset (LISTO) – LISTO supports low income earners to accumulate super and make sure they don’t pay more tax on their super than on their take-home pay. The income threshold for 2026/27 is $45,000 (up from $37,000) to match the top of the second income tax bracket. The maximum payment is $810 (up from $500) to take account of recent increases in the Superannuation Guarantee rate.

GST Thresholds

Item	* Threshold
Requirement to issue a tax invoice	$75
No requirement to withhold if supplier does not quote ABN	$75
Turnover for compulsory registration for GST	$75,000 (for any 12 months)
Turnover for compulsory registration for GST (non-profit entity)	$150,000 (for any 12 months)
Annual turnover for compulsory use of non-cash accounting	$10,000,000
Annual turnover for compulsory monthly electronic BAS lodgement	$20,000,000

* all amounts are GST exclusive 

Important Note: All drivers and owner drivers of taxi travel vehicles must register for GST as a sole trader, (regardless of their turover) unless they are an employee.