Company Tax Calculator
Work out your Australian company tax for the 2025–26 income year — the calculator applies the 25% base rate entity rate or the 30% full rate based on your aggregated turnover, and shows the franking credits you can attach to a fully franked dividend.
Rates valid for income year 2026 · Official source: ato.gov.au
How Australian company tax works
Company tax is Australia’s single national tax on company profits, levied under the Income Tax Assessment Act and administered by the Australian Taxation Office (ATO). Unlike many countries, Australia has no state, territory or municipal tax on corporate income — there is no regional add-on, no trade tax and no general corporate surcharge. Whatever rate applies, it is the whole of the tax a company pays on its profits at a federal level.
For the 2025–26 income year (1 July 2025 to 30 June 2026) there are two possible flat rates: the 30% full company tax rate, which applies to most companies, and a reduced 25% rate for companies that qualify as a base rate entity (BRE). Unlike the UK’s Marginal Relief system, there is no tapering band between the two Australian rates — a company either qualifies as a base rate entity and pays 25% on all of its taxable income, or it doesn’t and pays 30% on all of it. These rates and the $50 million threshold have been unchanged since the 2021–22 income year.
Company tax rates for 2025–26
| Tax | Rate / band |
|---|---|
| Company tax | 25% (≤ $50,000,000) · 30% (above) |
To qualify as a base rate entity and access the 25% rate, a company must pass both of two tests for the income year:
- Aggregated turnover below $50 million — your company’s own annual turnover combined with the turnover of any connected entities and affiliates must come to less than $50 million.
- No more than 80% passive income — no more than 80% of the company’s assessable income can be “base rate entity passive income” (BREPI), a defined category covering interest, rent, most dividends, royalties, net capital gains and certain trust or partnership distributions.
Failing either test — turnover of $50 million or more, or passive income above 80% of assessable income — means the company pays the 30% full rate instead, even if it is a small business by every other measure.
Worked examples
Example 1 — a base rate entity. A trading company has aggregated turnover of $10 million (comfortably under $50 million) and earns only active trading income, well under the 80% passive-income limit. It qualifies as a base rate entity. On taxable income of $500,000, its company tax is:
- $500,000 × 25% = $125,000 company tax
- Profit after tax: $500,000 − $125,000 = $375,000
Example 2 — not a base rate entity. A second company has the same $500,000 of taxable income, but either its aggregated turnover is $50 million or more, or more than 80% of its income is passive (for example, a holding company earning mostly rent and dividends). It fails the base-rate-entity test and pays the full rate:
- $500,000 × 30% = $150,000 company tax
- Profit after tax: $500,000 − $150,000 = $225,000
The $25,000 difference between the two outcomes on identical taxable income shows why the base-rate-entity test — not just the headline rate — is the number that matters most.
Franking credits and dividend imputation
Australia runs a full dividend imputation system. Company tax paid is not the end of the story for shareholders — it builds up franking credits in the company’s franking account, which can be attached to dividends paid out to shareholders. On a fully franked distribution, the maximum franking credit is the dividend multiplied by rate ÷ (1 − rate): 30/70 for a company on the 30% rate, or 25/75 for a 25% base rate entity. Shareholders gross up the dividend by that credit and offset it against their own income tax bill, and any excess credit is refundable to eligible resident shareholders. This calculator focuses on the company-level tax and does not compute franking credits directly, but the mechanism is essential context for understanding what company tax actually costs a shareholder in the end.
What most company tax calculators miss
Plenty of Australian company tax calculators stop at the aggregated-turnover check — enter turnover under $50 million and they hand you the 25% rate without asking anything else. That misses the second limb of the base-rate-entity test: the 80% passive-income cap. A small investment or holding company can easily have turnover well under $50 million and still be taxed at the full 30% rate, because most of its income is interest, rent, dividends or capital gains rather than active trading income. Getting this wrong overstates after-tax profit and understates the tax bill — always check both tests, not just turnover.
Losses and the instant asset write-off
Two further notes worth knowing alongside the headline rate. Tax losses can be carried forward indefinitely, but using a prior-year loss requires passing either the Continuity of Ownership Test or, if that fails, the Business Continuity Test; general loss carry-back is not currently available. Separately, the $20,000 instant asset write-off lets small businesses with aggregated turnover under $10 million immediately deduct eligible assets costing less than $20,000, reducing taxable income (and now made permanent from 1 July 2026). Neither losses nor the write-off are modelled in this calculator — they affect the taxable income figure you enter, not the rate itself.
Related calculators
Running a company usually means paying yourself as well. Model take-home pay with our Australian salary calculator, check a personal tax bill with the Australian income tax calculator, or compare corporate rates in the region with the Malaysian corporation tax calculator and the Indonesian corporation tax calculator.
Last updated: July 2026. Rates valid for the 2025–26 income year. This page is general guidance, not tax advice — always verify your figures with a registered tax agent or the ATO before lodging.