What company tax rate applies to my Pty Ltd?

25% if it's a base rate entity — aggregated turnover under $50 million and no more than 80% passive income. Otherwise, the standard 30% rate applies.

Should I pay myself a salary or dividends from my company?

A salary is deductible to the company and attracts the 12% Superannuation Guarantee, but is taxed at your personal marginal rate plus Medicare Levy. Dividends are paid from after-tax company profit and carry a franking credit for the company tax already paid — the best mix depends on your total income, your super goals and cashflow needs.

What is Division 7A and why does it matter?

Division 7A can treat loans, payments or other benefits a company gives to a shareholder (or their associate) as an unfranked deemed dividend if they aren't properly documented as a complying loan — a common trap for owner-operators drawing informally from company funds.

Do I need to pay super if I pay myself a company salary?

Yes — the 12% Superannuation Guarantee applies to your own wages from your own company in exactly the same way it applies to any other employee.

Could the PSI rules override my salary/dividend planning?

Yes. If most of the company's income is Personal Services Income and none of the self-assessment tests are met, that income gets attributed to you personally regardless of how you'd otherwise want to structure salary and dividends — see the PSI tax calculator to check this first.

Pty Ltd Tax & Dividend Calculator (Australia, FY2026-27)

Salary	Dividend	Net-in-pocket
$0	$75,000	$75,000
$5,000	$71,250	$76,250
$10,000	$67,500	$77,500
$15,000	$63,750	$78,750
$20,000	$60,000	$79,730
$25,000	$56,250	$80,230
$30,000	$52,500	$80,531
$35,000	$48,750	$80,531
$40,000	$45,000	$80,930
$45,000	$41,250	$81,330
$50,000	$37,500	$80,980
$55,000	$33,750	$80,630
$60,000	$30,000	$80,280
$65,000	$26,250	$79,930
$70,000	$22,500	$79,580
$75,000	$18,750	$79,230
$80,000	$15,000	$78,880
$85,000	$11,250	$78,530
$90,000	$7,500	$78,180
$95,000	$3,750	$77,830
$100,000	$0	$77,480

Salary

Dividend

Net-in-pocket

$75,000

$5,000

$71,250

$76,250

$10,000

$67,500

$77,500

$15,000

$63,750

$78,750

$20,000

$60,000

$79,730

$25,000

$56,250

$80,230

$30,000

$52,500

$80,531

$35,000

$48,750

$80,531

$40,000

$45,000

$80,930

$45,000

$41,250

$81,330

$50,000

$37,500

$80,980

$55,000

$33,750

$80,630

$60,000

$30,000

$80,280

$65,000

$26,250

$79,930

$70,000

$22,500

$79,580

$75,000

$18,750

$79,230

$80,000

$15,000

$78,880

$85,000

$11,250

$78,530

$90,000

$7,500

$78,180

$95,000

$3,750

$77,830

$100,000

$77,480

Salary or dividends: getting the mix right in a Pty Ltd

Running your contracting business through a Pty Ltd company adds a genuine planning question: pay yourself a salary (deductible to the company, taxed at your marginal rate, and requiring 12% Superannuation Guarantee), take dividends (taxed at company level first, then passed through with franking credits), or some mix of both — while staying inside the base rate entity rules and avoiding Division 7A traps.

Most owner-operator companies qualify for the 25% base rate entity company tax rate rather than the standard 30%, provided aggregated turnover is under $50 million and no more than 80% of assessable income is passive. This calculator works through the combined outcome of your chosen salary/dividend split for FY2026-27.

How to use this calculator

Enter your company's profit before any salary or dividend
Set the salary portion — this reduces company tax and attracts 12% super, PAYG and income tax
See the remaining profit taxed at company level, then the dividend and franking credit outcome
Review the combined personal + company tax result and watch for the Division 7A flag on shareholder drawings

Pty Ltd Tax & Dividend Calculator