Social security in Australia 2026

Australia has no employee social insurance contributions: the welfare system is tax-funded, and the only payroll-adjacent charge on you is the 2% Medicare levy (plus a 1%–1.5% surcharge for higher earners without private hospital cover).

Retirement saving is compulsory but employer-funded: 12% of salary flows into your superannuation fund, taxed at 15% going in and on earnings, then tax-free out after age 60.

At a glance

top rate: 2% Medicare levy (+ up to 1.5% surcharge)
entry band: Levy relief below roughly AUD 28,000 of income
tax year basis: 1 July – 30 June, collected with income tax
filing deadline: Through the annual return
residency basis: Levy applies to residents entitled to Medicare
regime flag: Employer super guarantee: 12% of salary

Rates

What individuals pay (2025/26)

Rate	Base	Applies to
2%	Taxable income	Medicare levy — funds the public health system
1% – 1.5%	Taxable income	Medicare levy surcharge above AUD 97,000 (AUD 194,000 families) without private hospital insurance
0%	—	Employee social security contributions — none exist
15%	Concessional super contributions (cap AUD 30,000; 32,500 from July 2026)	Paid by the fund; an extra 15% applies once income plus contributions pass AUD 250,000

Thresholds & allowances

Super guarantee12% of ordinary earnings, employer-paid
On salary up to AUD 62,500 per quarter (an annual cap applies from July 2026)
Non-concessional capAUD 120,000 a year of after-tax contributions
Set at 4× the concessional cap; blocked once your balance reaches AUD 2 million (2.1 million from July 2026)

Residency

Residency trigger

The Medicare levy attaches to residents entitled to public healthcare; the superannuation guarantee attaches to Australian employment regardless of the worker's residence.

Non-resident treatment

Non-residents pay no Medicare levy. Temporary workers who leave permanently can withdraw their super — at a hefty 35% final withholding (65% for working-holiday makers).

Notes

Super contributions within the concessional cap are effectively salary taxed at 15% instead of your marginal rate — the country's main tax-planning lever.
From 1 July 2026, earnings on super balances between AUD 3 million and 10 million bear a total 30% tax (40% above 10 million), paid by the fund.
Excess contributions face penal rates — up to 47% on excess after-tax contributions, refundable on request.
The self-employed contribute voluntarily; deductions apply within the same caps.

FAQ

What social security do employees pay in Australia?

None — 0% employee contributions. The 2% Medicare levy inside income tax is the only charge, and employers separately pay 12% of salary into superannuation.

How is superannuation taxed in Australia?

Concessional contributions (up to AUD 30,000 in 2025/26) and fund earnings are taxed at 15% — plus another 15% on contributions once income exceeds AUD 250,000. Withdrawals after age 60 from ordinary funds are tax-free.

Figures: tax year 2025/26 (July–June basis), compiled from public sources. Not tax advice.

See social security in other countries

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