ATO Schedule 5, method A

Bonus tax calculator

Bonuses aren't taxed at a special rate, but the way employers withhold on them can make your payday smaller than you expect. See both numbers.

  • Same engine as the pay calculator
  • Private — runs in your browser
On payday you receive $6,828 $3,172 withheld (31.7%)
After tax time you keep $6,800 your actual tax on it is $3,200 (32%)

Employers work out bonus tax with the ATO's Schedule 5 "method A": they spread the bonus across the year's pays, work out the extra tax on each pay, then multiply back up. About $28 too little is withheld, so you'll owe that at tax time.

Or sacrifice it into super?

Take as cashSacrifice to super
Your take-home+$6,800+$0
Your super (after 15% tax)+$0+$9,520
Total value$6,800$9,520

You must agree the sacrifice with your employer before the bonus is earned.

Frequently asked questions

Are bonuses taxed at a higher rate?
No. A bonus is ordinary income, taxed at your marginal rate plus the Medicare levy. What’s different is the withholding. Employers use the ATO’s Schedule 5 methods, and the amount withheld can differ from your real tax. Any difference comes back, or is owed, when you lodge.
Is there a cap on bonus withholding?
Yes. Under methods A and B(ii), the extra amount withheld because of a bonus is capped at 47% of the bonus, including any HELP component.
Can I put my bonus into super instead?
Yes, if you arrange a salary sacrifice agreement before the bonus is earned. It’s taxed at 15% in the fund instead of your marginal rate. It counts towards your concessional cap and still counts as income for HELP repayments.
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