What is salary packaging and how does it affect my take-home pay?

Salary packaging (also called salary sacrifice) lets you pay for certain items like a car or super contributions from your pre-tax income, reducing your taxable income. It is arranged through your employer or salary packaging companies Australia. Our calculator does not include salary packaging; you need to adjust your tax estimate separately. The Australian Taxation Office sets rules on what can be packaged and caps apply.

Does the calculator include casual loading?

Yes, you can select a checkbox to add 25% casual loading on top of your base hourly rate. Do not enter a rate that already includes casual loading. The loading is added automatically. Casual loading compensates for entitlements like paid leave that casual employees do not receive.

How is tax calculated in this estimate?

Tax uses the 2026–27 resident tax rates: nil on the first $18,200, then 15% up to $45,000, 30% up to $135,000, 37% up to $190,000, and 45% above that. Medicare levy is 2% of taxable income. The tax-free threshold is assumed. HELP, Medicare levy surcharge, and salary packaging are not deducted. For a precise figure, consult the ATO or a tax professional.

Hourly to Annual Pay: National Minimum Wage vs Award Rates & Salary Packaging Companies Australia

For a 38-hour week, the National Minimum Wage is $26.44/hour, giving an annual gross of $52,245.44 before tax and super.

Converting Your Hourly Rate to Annual Pay

To convert an hourly rate to annual gross pay, multiply the hourly rate by the number of hours worked per week, then by 52 weeks. Our calculator assumes a standard full-time week of 38 hours, as defined by the Fair Work Ombudsman. For example, the National Minimum Wage from 1 July 2026 is $26.44 per hour. For a 38-hour week, the annual gross is:

$26.44 × 38 × 52 = $52,245.44

If you work a different number of hours each week, adjust the weekly hours accordingly. The formula is the same: hourly × hours per week × 52. This estimate assumes the same rate every week, no unpaid overtime, no penalty rates, no allowances, and no salary sacrifice.

Fortnightly Pay

Your fortnightly gross pay is simply your weekly pay multiplied by two. For the National Minimum Wage at 38 hours per week, weekly pay is $1,004.90, so fortnightly gross is $2,009.80. Many employers pay fortnightly, so this figure helps you budget.

National Minimum Wage vs Award Rates

The National Minimum Wage is the base minimum pay for employees not covered by an award or agreement. It is set by the Fair Work Commission. However, most employees are covered by an industry or occupation award that sets higher minimum rates. Award rates vary by job classification, experience, and industry. They often include penalty rates for weekends, nights, or public holidays. The National Minimum Wage is a floor; award rates are typically above it.

Our minimum wage page provides more detail. If you are covered by an award, your hourly rate may be higher than the National Minimum Wage. Check your award through the Fair Work Ombudsman website.

Casual Loading

Casual employees are entitled to a 25% loading on top of their base hourly rate. This compensates for not receiving paid leave or other entitlements. Our calculator has a checkbox to add 25% casual loading automatically. Do not enter a rate that already includes casual loading. If you are casual, enter your base rate (the rate before loading) and tick the box. The calculator will add 25% to that base rate. For example, the National Minimum Wage casual rate is $26.44 × 1.25 = $33.05 per hour. See our casual loading page for more.

Super Guarantee

Superannuation is paid on top of your ordinary earnings. The super guarantee rate is 12% from 1 July 2026. It applies to ordinary time earnings up to the maximum contribution base of $270,830 per year. Super is not deducted from your pay; your employer adds it separately. For the National Minimum Wage example, annual super would be 12% of $52,245.44 = $6,269.45, but only if your earnings are below the cap. If you earn more than $270,830, super stops at that amount.

When considering salary packaging companies Australia, remember that super is paid on top of your ordinary earnings. Salary packaging arrangements can affect your super guarantee base, so check with your employer or a financial adviser. Our super and packaging page covers this in more detail.

Tax and Take-Home Pay

Tax is calculated using the 2026–27 resident tax rates. The first $18,200 is tax-free. Then:

15% on income from $18,201 to $45,000
30% on income from $45,001 to $135,000
37% on income from $135,001 to $190,000
45% on income over $190,000

Medicare levy is generally 2% of taxable income. Our calculator uses the 2025–26 single reduction thresholds because the 2026–27 thresholds were not confirmed here. This means the Medicare levy estimate may be slightly different for low-income earners. For a full breakdown, see our take-home pay page.

Example: National Minimum Wage

For a full-time employee on the National Minimum Wage ($26.44/hour, 38 hours/week):

Annual gross: $52,245.44
Tax (using 2026–27 rates): approximately $6,013.63 (first $18,200 tax-free, then 15% on $26,845.44 = $4,026.82, plus 30% on $7,245.44? Wait, let's calculate properly: $52,245.44 - $18,200 = $34,045.44. First bracket $18,201-$45,000 is $26,800 at 15% = $4,020. Then remaining $7,245.44 at 30% = $2,173.63. Total tax = $6,193.63. Plus Medicare 2% of $52,245.44 = $1,044.91. Total deductions = $7,238.54. Take-home = $45,006.90 per year.
Fortnightly take-home: about $1,731.03.
Super (12%): $6,269.45 per year, paid on top.

Using the Calculator

Our timesheet is the home page. Enter your base hourly rate. If you are casual, tick the 25% casual loading checkbox. The calculator shows your annual gross, fortnightly gross, estimated tax, Medicare, super, and take-home pay. It assumes a 38-hour week unless you change the hours. Remember, this is an estimate. For a precise determination of your pay, consult your employer, award, or a professional.

Salary Packaging Companies Australia

If you are considering salary packaging, many salary packaging companies Australia offer services to help you set up arrangements for cars, laptops, or additional super contributions. Salary packaging reduces your taxable income, which can lower your tax and increase your take-home pay. However, it also reduces your super guarantee base in some cases. Always check the rules with the ATO and your employer. Our calculator does not account for salary packaging; you need to adjust your tax estimate manually. For more, see our super and packaging page.

Important Notes

The National Minimum Wage and award rates are set by the Fair Work Commission. The figures here are from 1 July 2026.
ABS Average Weekly Earnings (May 2026) for full-time adult ordinary time is $2,083.70 per week. This is an average across all industries and occupations, not a median for any specific job. Do not use it as a median for your role.
All employees total earnings (including part-time) average $1,579.20 per week.
The super guarantee maximum contribution base is $270,830 for 2026–27.
Tax rates are for residents. Non-residents have different thresholds.
This article is a guide only. Always refer to official sources: Fair Work Ombudsman, Australian Taxation Office, and Australian Bureau of Statistics.

For more detailed pay guides and reference tables, visit our pay guides and reference tables pages.