ATO Tax Guide Australia

Complete guide to Australian tax returns, deductions, offsets, and ATO compliance for individuals and small business

Australian Tax Explained for 2025-26

Tax time is stressful for most Australians, but it does not need to be. This site explains how the Australian tax system actually works — the rates the ATO applies for 2025-26, the deductions and offsets you are entitled to, and the deadlines you must hit — in plain English, without the jargon.

Who is this for? Employees lodging their first return, sole traders and small business owners, investors with shares or rental properties, parents using super to save for a first home, and anyone who wants to stop overpaying tax. Each guide stands alone, so you can jump straight to the topic you need.

How to use this site: start with the tax return guide if you are new to lodging, then check the deductions guide before you claim anything. Business owners should read the sole trader and company tax guides, and investors should review the capital gains and investment property pages before selling anything. All figures reflect the ATO's published 2025-26 rates; always confirm current numbers on the ATO website before you lodge.

How to Lodge Your Tax Return

Step-by-step guide to lodging via myGov, registered tax agent, or paper. Deadlines, fees, and what you need to get started.

Work-Related Expense Deductions

Claim WFH, uniforms, travel, tools, and self-education expenses. ATO rules, fixed rate method, and audit-proofing your claims.

Investment Property Tax Deductions

Negative gearing, capital works depreciation, plant & equipment, borrowing costs, and maximising your rental property return.

Capital Gains Tax Explained

Main residence exemption, 50% CGT discount, calculating gains, and CGT events for property, shares, and business assets.

Sole Trader Tax Guide

ABN, BAS lodgement, PAYG instalments, GST registration, and deductions for sole traders and independent contractors.

Company Tax & Franking Credits

Company tax rates, dividend imputation, franking credits, directors' obligations, and FBT explained.

Super Contributions Tax Guide

Concessional vs non-concessional caps, carry-forward rules, Division 293, and salary sacrificing strategies.

First Home Super Saver (FHSS) Scheme

Use super to save for your first home — tax benefits, release amounts, and eligibility rules explained.

Medicare Levy & MLS

Medicare Levy rates, exemptions, low-income reductions, and the Medicare Levy Surcharge income thresholds.

Tax Offsets: LITO, SAPTO & More

Low Income Tax Offset, Senior and Pensioners Tax Offset, franking credits, and how offsets reduce your tax dollar-for-dollar.

Record Keeping for Tax

What records to keep, how long to keep them, best apps, and how to survive an ATO audit.

10 Common Tax Return Mistakes

Avoid ATO audits — learn the most common errors and how to keep your tax return error-free.

Frequently Asked Questions

Do I need to lodge a tax return in 2026?

You must lodge if you earned more than the $18,200 tax-free threshold, if any tax was withheld from your pay, if you ran a business, if you had a capital gains event, or if the ATO asked you to lodge. If your only income was under the threshold and no tax was withheld, you generally do not need to lodge — but you should still consider lodging to claim refundable offsets or a deduction for work expenses.

What is the deadline to lodge my 2025-26 return?

If you lodge yourself, your return is due by 31 October 2026. If you use a registered tax agent and are registered with them by 31 October, the deadline extends to 15 May 2027. Late lodgement attracts a failure-to-lodge penalty of $330, plus $330 for each 28-day period overdue (capped at $1,650).

How much tax will I pay on my income in 2025-26?

Resident rates for 2025-26 are: 0% up to $18,200; 16% from $18,201 to $45,000; 30% from $45,001 to $135,000; 37% from $135,001 to $190,000; and 45% above $190,000. The 2% Medicare levy applies on top for most people. Offsets like LITO mean low earners can earn around $22,575 before paying any income tax.

What records do I need to keep, and for how long?

Keep records that prove your income and deductions — payment summaries, receipts, invoices, diaries and logbooks — for five years after you lodge the relevant return. If you claim more than $300 of work-related deductions, you need written evidence for the full amount, not just the amount above $300.

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