Ben Nash has shared the moves you can make to cut your tax bill in 2026 and get ahead. (Source: Ben Nash/Getty) · Ben Nash/Getty
In Australia, we pay a lot of tax, and it seems to be increasing every year. The good news is that to put a real dent in your tax in 2026, you don’t need dodgy loopholes or wild tactics. You just need a few solid moves that allow you to use the rules to your advantage.
Coming into the new year, there is a practical, numbers-first playbook you can follow to cut your tax and keep more of your income in the year ahead – with a small number of moves you can follow to move the dial on your annual ATO donation.
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The tax rules can be complicated and confusing, but one of the most basic things you need to understand if you want to save tax is around the different tax brackets, where you sit, and what your rate of tax actually is.
Today, the tax rates that apply across income brackets (including 2 per cent medicare levy) are as follows:
$0 – $18,200: 0 per cent
$18,201 – $45,000: 18 per cent
$45,001 – $135,000: 32 per cent
$135,001 – $190,000: 39 per cent
$190,001 and over: 47 per cent
One of the most common myths that trips people up is the fact that when you move into a higher tax bracket, that higher tax rate only applies to income above the bracket threshold – i.e. even if you earn $200,000, you still pay 0 per cent tax on the first $18,200 you earn, 18 per cent on the income earned between $18,201 and $45,000, etc.
This means that the more you earn, the higher your tax rate is – but it also means the higher the value of every dollar of tax deductions becomes.
When it comes to tax saving, you can only claim what you can prove. Line up the basics now: work-related expenses connected to your income, work-from-home expenses, work travel costs, and other memberships and tech costs, along with anything that’s specific to your income.
But if you don’t know what you can claim, you can’t claim it. So one of the first steps in saving tax is to get yourself across the deductions you can claim and make sure you’re taking advantage. The ATO has a lot of helpful content on its website about the different deductions available to different occupation types – invest some time here and it will pay dividends in 2026 – and every year to come.
Timing can improve your refund without changing what you actually do. If you own property, prepayments for the coming 12 months can give you a serious boost at tax time. Note these expenses still cost you money, so it’s not free money. But if you have the expenses coming up, think through any deductible payments you have coming up in the year ahead, and if you can manage them before June 30 you’ll receive the tax deduction (and refund) a full year sooner.
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Also, remove any tax blockers you have in place, like the medicare levy surcharge. This is an extra tax of up to 1.5 per cent of your total income that kicks in if you earn above $101,000 for individuals and $202,000 for couples and don’t have private hospital insurance in place. This can mean thousands of dollars in tax each year if you’re not across the rules, and given the hospital insurance can be less than the tax it can be a simple way to keep you ahead.
Timing is one thing that can help maximise your tax refund. (Source: Getty)
Negative gearing is a way to trim tax while you grow your assets. For example, if you buy a $600,000 property with a 6.5 per cent mortgage interest rate, the interest is about $39,000 each year, with property costs of 1 per cent of the property value or $6,000 yearly (total costs of $45,000) against rental income of $33,800, you’re out of pocket for $11,200 each year.
Under the negative gearing rules, this cost is generally fully tax deductible, and based on a 39 per cent tax rate, this means a tax refund of $4,368 – bringing the cost of you holding the property to $6,832 each year.
Given you now own an asset that should grow at the long term property growth rate of 6.8 per cent, delivering you $40,800 each year in growth – the end result is a net benefit of over $36,000 each year – along with the tax deductions.
Superannuation is a low-tax home for long-term money. Tax-deductible contributions reduce your taxable income, and earnings on money inside super are taxed at a maximum rate of 15 per cent as opposed to marginal rates of up to 47 per cent.
And in retirement, you can earn income on super investments of up to $1.9 million without paying any tax at all. This makes super one of the most effective tax tools you have available – and even if retirement is a long way off, even small moves now will make a big difference later.
Paying less tax in 2026 is about purpose, not hacks. You want to use the rules to your advantage and be smart with how you get ahead, which will see you keep more of your income that you can use to get ahead (or spend on your lifestyle today).
Know your bracket, claim what you’re entitled to, and bring forward deductions you’re going to get anyway. Use smart tax strategies to crank your deductions even further, and with two to three clean moves, you’ll set up 2026 to be the year you actually get ahead.
Ben Nash is a finance expert commentator, podcaster, financial adviser and founder of Pivot Wealth. Ben’s new book, Virgin Millionaire; the step-by-step guide to your first million and beyond is out now on Amazon | Audiobook.
If you want some help with your money and investing, Ben has created a free seven-day challenge you can use to get more out of your money you can join here.
Disclaimer: The information contained in this article is general in nature and does not take into account your personal objectives, financial situation or needs. Therefore, you should consider whether the information is appropriate to your circumstances before acting on it, and where appropriate, seek professional advice from a finance professional.
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