A tax estimate from an online calculator is a preliminary calculation based on the data you enter at the time. The ATO Notice of Assessment is the official result after lodgment, data-matching, pre-fill updates and account balancing. Estimates are not guaranteed.

Tax Liability Versus Refund

Tax liability is the tax owed on taxable income after offsets. A refund occurs only when PAYG withheld exceeds that final liability. A tax estimate is not a guaranteed assessment.

Checked Reconciliation Example

Assumptions: single Australian resident, one employer, 2025–26 income year return, no HELP debt and no tax offsets.

Inputs: gross income $75,000, PAYG withheld $14,000, basic deductions $300.

Calculation steps (2025–26 resident rates):

  1. Taxable income = $75,000 − $300 = $74,700.
  2. Tax on taxable income:
    • $0 on the first $18,200
    • 16% × ($45,000 − $18,200) = 16% × $26,800 = $4,288
    • 30% × ($74,700 − $45,000) = 30% × $29,700 = $8,910
    • Income tax = $13,198
  3. Medicare levy (2% × $74,700) = $1,494.
  4. Total liability = $13,198 + $1,494 = $14,692.
  5. Refund or amount owed = $14,000 − $14,692 = $692 owed.

Sources: Tax rates – Australian resident (2025–26: 16c between $18,201 and $45,000; $4,288 plus 30c above $45,000) and the standard Medicare levy of 2%. The Low Income Tax Offset does not apply at this income (it cuts out at $66,667).

Result: an earlier estimate showed a $400 refund; the assessment shows $692 owed because updated pre-fill data changed the inputs.

Limitations: this example ignores other offsets, debts offset against your refund, Medicare levy surcharge, and changes made after lodgment.

Practical Input Checklist

Cross-check these items against your income statement and payslips:

  • Gross income
  • Tax withheld
  • Any updates to pre-fill data
  • Existing ATO credits, debits or offsets against other government debts

Wait for all pre-fill where possible before lodging.

Common Reasons for Differences

Differences arise from data-matching corrections, updated income statements, offsets against debts, lodging before full pre-fill is available, or additional liabilities such as HELP repayments or the Medicare levy surcharge.

Run your own 2025–26 numbers with the Australia 2025–26 individual tax calculator, then compare the result with your Notice of Assessment once it issues.