Compliance
Mastering Australia’s New PAYG Withholding Tables from 1 July 2026
With the 2026 PAYG withholding tables updated—reflecting income tax rate cuts and loan thresholds—every employer’s payroll system must be ready by the new financial year.
By NomadicTax Research Team • 5-8 min read • June 13, 2026
## Overview of the PAYG Tables Update
From **1 July 2026**, all 15 PAYG withholding schedules and 12 tax tables will be updated and must be used by employers and payers across Australia. These changes are driven by the recent amendments from the Treasury Laws Amendment (More Cost of Living Relief) Act 2025. Key updates include: updated income tax rate thresholds, revised loan repayment thresholds (e.g. for HELP/SSL), and adjustments reflecting the new tax cuts. ([softwaredevelopers.ato.gov.au](https://softwaredevelopers.ato.gov.au/2026-pay-you-go-payg-withholding-tax-tables-0?utm_source=openai))
## What Specifically Has Changed
Here’s a breakdown of what’s new:
- The **tax rate cuts** for individuals announced in the 2025–26 Budget are now incorporated in all withholding schedules—lowering rates and adjusting the thresholds. ([softwaredevelopers.ato.gov.au](https://softwaredevelopers.ato.gov.au/2026-pay-you-go-payg-withholding-tax-tables-0?utm_source=openai))
- Study and training support loan (e.g. HELP) thresholds have been indexed, meaning repayment obligations may kick in at different income levels. ([softwaredevelopers.ato.gov.au](https://softwaredevelopers.ato.gov.au/2026-pay-you-go-payg-withholding-tax-tables-0?utm_source=openai))
- **Format changes**: Some schedules now aggregate certain tables (e.g. multiple “other schedules” embedded under NAT 1004’s “Other schedules” tab), and examples have been updated. ([softwaredevelopers.ato.gov.au](https://softwaredevelopers.ato.gov.au/2026-pay-you-go-payg-withholding-tax-tables-0?utm_source=openai))
## Implications for Employers and Payroll Professionals
Employers and those managing payroll need to take the following actions:
- Audit your payroll/revenue systems now to ensure they include the updated tables. If you continue using old rates after 1 July, you risk under-withholding and having employees face tax shortfalls at year-end.
- Communicate with payroll software providers. Many tools automate updates—confirm that yours has scheduled these changes.
- Review employee loan thresholds. Those with education debts may have different withholding amounts; payroll staff must check which thresholds apply.
## Examples
- **Example 1**: An employee earning $60,000 per year will see a different withholding amount under the new tax table versus the old, because their marginal rate will change slightly due to the rate cuts.
- **Example 2**: An employee with HELP debt earning $55,000 pre-1 July might have a different repayment rate post-changes thresholds; employers must withhold accordingly.
## Action Steps Checklist
| Task | Deadline | Why It Matters |
|---|---|---|
| Update payroll configuration with new tables | Before first payday in July 2026 | Avoid incorrect withholding or underpayments |
| Train payroll staff on new loan repayment thresholds | Summer 2026 | Ensures correct deductions for students and trainees |
| Conduct a full payroll audit | June 2026 | Catch any mismatches before the changes go live |
By proactively managing these changes, employers can ensure compliance and avoid downstream issues for both their employees and the business as a whole.