8,200** you earn in a financial year is tax-free for Australian residents. If you have a job and a sole trader business, the threshold applies to your **total combined income**. Most people 'claim' the threshold on their main salary from their employer so that no tax is taken from their first 8,200 of wages. If your total income (Salary + Business Profit) is below 8,200, you will generally get back any tax you paid during the year. If you are a non-resident for tax purposes, y"}}]}

How does the tax-free threshold work in Australia?

The first **$18,200** you earn in a financial year is tax-free for Australian residents. If you have a job and a sole trader business, the threshold applies to your **total combined income**. Most people 'claim' the threshold on their main salary from their employer so that no tax is taken from their first $18,200 of wages. If your total income (Salary + Business Profit) is below $18,200, you will generally get back any tax you paid during the year. If you are a non-resident for tax purposes, you generally do not get a tax-free threshold and pay tax from the first dollar.

  • $18,200 is tax-free for residents
  • Applies to your TOTAL income from all sources
  • If income < $18,200, you pay $0 income tax
  • Medicare Levy may still apply above $26k
  • Non-residents don't get the threshold