Free sole trader tax calculator for Australian self-employed individuals. Calculate your income tax, Medicare levy, and Small Business Income Tax Offset based on your business income and deductible expenses. Includes estimated quarterly BAS obligations and super contributions.
Total revenue/sales (excl. GST if registered)
Deductible business costs
Personal concessional contributions
Net Income After Tax
$0
$0/month
Total Tax
$0
Effective rate: 0.0%
Est. Quarterly PAYG Instalment
$0
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A sole trader in Australia pays tax on business profit (income minus expenses) at individual income tax rates — there is no separate company tax. You report your business earnings and deductions on your individual tax return, and the ATO treats that net business profit as part of your total taxable income alongside any salary or investment income.
Net business income = Business income − Deductible expenses. Taxable income = Net business income + Other income − Deductible super. Total tax = Income tax (resident brackets) − offsets (LITO + Small Business Income Tax Offset) + 2% Medicare levy + any HELP/HECS repayment.
A self-employed tradie invoices $120,000 (excluding GST) and has $40,000 of deductible expenses, with no other income. Net business income is $120,000 − $40,000 = $80,000, which is also the taxable income. Applying the FY 2025-26 resident brackets ($4,288 base plus 30% of the amount over $45,000) gives $14,788 of income tax before offsets. The Small Business Income Tax Offset is 16% of the tax on the small business share of income, capped at $1,000, so it reduces tax by the full $1,000 to $13,788. Adding the 2% Medicare levy ($1,600) brings total tax to $15,388 — an effective rate of about 19%. A rough quarterly PAYG instalment is that total divided by four, around $3,847. Use the calculator above for your own figures, as offsets and Medicare reductions depend on your circumstances.
Maximise deductions by claiming all legitimate business expenses, make concessional super contributions (up to $30,000/year), prepay expenses before 30 June, and use the instant asset write-off for eligible business assets first used or installed ready for use by 30 June 2026 and costing less than $20,000 (per asset).
Sole traders are taxed on their business profit (income minus expenses) at individual income tax rates. Business income is included in your personal tax return. You don't pay a separate 'business tax' like companies do.
Subtract deductible expenses from your business income to get net business profit, add any other income and subtract deductible super to get taxable income, then apply the ATO resident income tax brackets. Reduce the result by the Low Income Tax Offset and the Small Business Income Tax Offset, then add the 2% Medicare levy and any HELP/HECS repayment. The calculator above does this for FY 2025-26 instantly.
There is no fixed small business tax rate for a sole trader — you pay individual income tax on your net profit. For example, $80,000 of net business income in FY 2025-26 attracts about $15,388 of total tax (income tax of $14,788 less the $1,000 Small Business Income Tax Offset, plus the 2% Medicare levy of $1,600), an effective rate of roughly 19%. Higher profits are taxed at higher marginal rates. Enter your own numbers above for an estimate.
The Small Business Income Tax Offset (SBITO) provides a tax offset of up to $1,000 for sole traders with aggregated business turnover under $5 million. For FY 2024-25 and FY 2025-26 it is calculated as 16% of the share of your income tax payable that relates to your net small business income, capped at $1,000 per individual (and never more than your tax payable).
You must register for GST if your annual GST turnover is $75,000 or more (the not-for-profit threshold is $150,000). You must also register from day one — regardless of turnover — if you drive a taxi, limousine or ride-sourcing service (Uber, DiDi, Ola, etc.) or if you want to claim fuel tax credits. Once registered, you charge 10% GST on taxable sales, can claim GST credits on business purchases, and lodge a BAS — quarterly by default for turnovers under $20 million, monthly for $20 million or more, or annually if you voluntarily registered below the $75,000 threshold.
PAYG (Pay As You Go) instalments are pre-payments toward your expected end-of-year income tax bill. The ATO puts you into the PAYG instalment system once your business income reaches its threshold, after which you pay a portion of your estimated tax each quarter (or annually) rather than one lump sum at tax time. The instalments are credited against your final tax assessment, so you are not paying extra — you are paying earlier. The 'estimated quarterly PAYG instalment' above is your total estimated tax divided by four, as a rough planning guide.
Yes, sole traders can make personal super contributions and claim them as a tax deduction. This reduces your taxable income. The concessional contributions cap is $30,000 per year.
Common deductions include: home office expenses, vehicle expenses, tools and equipment, professional development, insurance, accounting fees, phone and internet, advertising, and depreciation of business assets.
Sources & methodology
This calculator computes net business income (income minus expenses), adds other income, subtracts deductible super, then applies ATO individual (resident) income tax rates, the low income tax offset, the 16% small business income tax offset, the 2% Medicare levy and any HELP/HECS repayment for the selected financial year (FY 2025-26 by default). Figures are computed in your browser — nothing you enter is stored or sent to a server.
Authoritative sources
Reviewed by Bishal Shrestha — Founder of OneBookPlus, 10+ years building tools with Australian tax-agent and BAS-agent practices. Last reviewed and updated: May 2026.
Disclaimer: This calculator produces estimates only and is not tax advice. Tax outcomes depend on your individual circumstances. For decisions that affect your tax position, consult a registered tax agent or the ATO directly.
OneBookPlus handles invoicing, GST tracking, BAS prep, and ATO lodgement automatically.