Bonus After Tax Calculator
Calculate the net amount of a bonus payment you receive after all applicable taxes and deductions have been withheld.
Quick Use Samples
Bonus Details
After-Tax Bonus
Your gross bonus of $10,000 results in an estimated after-tax amount of $6,550. This equates to an effective tax rate of 34.5% on the bonus itself, as it's taxed at your highest marginal rate.
Bonus Breakdown
💰 Ready to grow your money?
- 🔹 Raiz: Microinvest your spare change
- 🔹 Swyftx: Trade crypto with confidence
We may receive a commission from our partners if you sign up through these links. This helps us keep our tools free.
What is a Bonus After Tax?
A bonus after tax is the net amount of a bonus payment you receive after all applicable taxes and deductions have been withheld. In Australia, bonuses are treated as regular income and are taxed at your marginal tax rate, which can significantly reduce the final amount you take home.
Behind the Formula
The calculator adds your bonus amount to your total annual income to determine the correct amount of tax to withhold. It calculates the tax on your salary *with* the bonus, then subtracts the tax you would have paid *without* the bonus. The difference is the tax attributable to the bonus. It also accounts for the Medicare Levy and any HECS-HELP repayments, as these are calculated based on your total income, including the bonus.
Expert Insights
- Your employer might withhold tax on your bonus at a higher rate as a precaution. The ATO provides specific methods for calculating PAYG on unusual payments like bonuses to avoid a tax shortfall, which can sometimes result in over-taxation that you'll get back in your tax return.
- A large bonus can push you into a higher tax bracket for that portion of your income. For example, if your salary is $110,000 and you get a $20,000 bonus, the first $10,000 of the bonus is taxed at 32.5%, but the next $10,000 is taxed at 37% (plus Medicare).
- Consider salary sacrificing your bonus into superannuation. This is one of the most effective ways to reduce the tax paid on a bonus, as the contribution is typically taxed at only 15% in your super fund, which is much lower than most marginal tax rates.
Actionable Tips
- Plan ahead. If you know a bonus is coming, speak to your payroll department or a financial advisor about salary sacrifice options well before the bonus is paid.
- Use your bonus to make a lump-sum contribution to your mortgage or other high-interest debt. Even after tax, a significant bonus can make a big dent in your liabilities.
- Don't forget about superannuation on your bonus. If your bonus is considered part of your 'Ordinary Time Earnings', your employer is required to pay the Superannuation Guarantee on it, giving your retirement savings an extra boost.
Real-World Examples
Receiving a Performance Bonus
Sarah earns $90,000 and receives a $10,000 performance bonus. The calculator shows that after income tax, Medicare, and HECS, her take-home amount from the bonus is only around $5,850, not the full $10,000.
Salary Sacrificing a Bonus
Tom is due a $20,000 bonus. Instead of taking it as cash and paying over $8,000 in tax, he arranges to salary sacrifice the entire amount into his superannuation. The bonus is taxed at 15% ($3,000) inside his super fund, saving him over $5,000 in tax.
Bonus Pushing into a Higher Tax Bracket
Emily's salary is $42,000, in the 19% tax bracket. She gets a $5,000 bonus. This pushes her total income to $47,000. The calculator shows that the first $3,000 of her bonus is taxed at 19%, but the next $2,000 is taxed at the higher 32.5% rate.
Glossary of Terms
Marginal Tax Rate
The tax rate you pay on the last dollar you earn. It's the rate applied to any additional income, such as a bonus.
Salary Sacrifice
An arrangement where an employee agrees to forgo part of their pre-tax salary in return for the employer providing benefits of a similar value, such as additional superannuation contributions.
Ordinary Time Earnings (OTE)
What an employee earns for their ordinary hours of work, including commissions, shift loadings, and some allowances. It's the base amount used to calculate the Superannuation Guarantee.