Second Job Tax Calculator
Work out what a second job really costs you in tax, and whether you are heading for a bill at tax time.
Your details
You keep from the second job
$13,575
Combined income
$85,000
Tax on the second job
$6,425
Effective rate on it
32.1%
Expect a bill at tax time
$3,425
You owe $17,720 on your combined income, and your two employers withhold about $14,295 between them. Each one withholds as though your job with them is your only income, so neither sees the full picture and the gap lands on you in October.
Your second job is not taxed at a higher rate
It just sits on top. Your first job uses the tax-free threshold and the lower brackets, so the second job's income starts where that left off, at your marginal rate of 32%. Same rules, same brackets, different position in the stack. Swapping which job you call the main one changes nothing about the total.
Withholding is estimated by applying the resident scale to each job separately, the way an employer does. Real withholding varies slightly with pay cycle rounding, so treat the gap as a close estimate rather than an exact bill.
How to use this calculator
- 1. Enter the job where you claim the tax-free threshold as the main job. If you're not sure which that is, it's the one where you answered yes on the Tax File Number declaration.
- 2. Casual shifts, weekend work, a second part-time role. Anything paid by a different employer with its own withholding.
- 3. If you ticked yes at both jobs, turn it on. It is a common mistake and the calculator will show you exactly what it is costing in under-withholding.
- 4. That's the bill you should be setting money aside for. It is not extra tax, it is tax nobody withheld along the way.
Your second job is not taxed at a higher rate
This is the myth worth killing first. There is no separate rate for second jobs, no penalty bracket, no punishment for working more. The tax system does not care how many employers you have, only what you earned in total across the year.
What makes it feel different is position in the stack. Your first job uses the tax-free threshold and the lower brackets, so by the time the second job's income is counted, those have been used up. Every dollar from the second job is taxed at whatever rate your combined income has already reached. On $65,000 plus a $20,000 second job, the effective rate on that second job is 32.1%, which is simply the 30% bracket plus the Medicare levy. Swap which job you call the main one and the total does not change by a cent.
How the tax-free threshold works with two employers
The first $18,200 you earn each year is tax-free, and it is a yearly amount, not a per-employer one. You nominate one employer to apply it by answering yes to the tax-free threshold question on your Tax File Number declaration, and you answer no everywhere else.
The second employer then withholds from the first dollar, using the no-threshold scale. That withholding looks brutal on a small casual wage, and it is the source of most of the confusion. It is not a higher rate, it is the same scale starting from zero instead of from $18,200.
What happens if you claim it at both jobs
Both employers treat your first $18,200 with them as tax-free, so between them they exempt $36,400 of income when you are only entitled to $18,200. Your take-home pay looks great all year and the shortfall arrives as one lump sum when you lodge.
Nothing bad happens beyond that, no penalty applies, and you have effectively had an interest-free loan from the ATO. But it is a rude surprise if you were not expecting it, and it repeats every year until you fix it. The fix is one form: lodge a new Tax File Number declaration with the second employer answering no, and withholding corrects itself from the next pay.
Why you can still get a bill doing everything right
This is the part almost nobody warns you about. Even with the threshold claimed correctly at one job, each employer withholds as though their job is your only income. Your second employer sees $20,000 a year and withholds at the rates that apply to a $20,000 earner, not at the 32% you actually face once it sits on top of $65,000.
In that example you owe $17,720 for the year and your employers withhold about $14,295 between them, leaving a shortfall of roughly $3,425. You did nothing wrong, the system simply cannot see both jobs at once. The practical answer is to put that amount aside as you go, or ask your second employer to withhold an extra fixed amount each pay using an upward variation.
Which job should claim the threshold
The higher paying one, in almost every case. Claiming it there means more of your income is withheld at the correct rates across the year, which shrinks the gap at tax time. Claim it at the small casual job instead and the large job withholds from dollar one while the small one barely withholds at all, which usually overshoots in the other direction.
The exception is if your jobs are similar in size, in which case it barely matters. Either way the total tax is identical, you are only choosing when you pay it. If your hours shift significantly during the year, update the declaration rather than leaving it and hoping.
HECS-HELP and the Medicare levy surcharge
Both use your combined income, and both catch second-job workers out. A HECS-HELP repayment kicks in once your total repayment income passes $69,528, and neither employer withholds for it if each job on its own sits under the threshold. That means the entire repayment arrives as a bill. Our HECS-HELP calculator shows what that repayment looks like.
The Medicare levy surcharge works the same way, applying to singles above $105,000 without private hospital cover. Two jobs that each look modest can combine to cross it. If your combined income is approaching either threshold, budget for the difference rather than discovering it at lodgement. Our tax refund calculator will estimate the whole year for you.
FAQ
Is a second job taxed at a higher rate in Australia?
No. There is no special rate for second jobs. Your income is added together and taxed on the same brackets as anyone else's. The second job feels heavily taxed because it sits on top of your first job's income, where your highest rate applies and the tax-free threshold has already been used.
Should I claim the tax-free threshold at my second job?
No, claim it at one job only, and generally the higher paying one. Claiming it twice means both employers exempt your first $18,200 with them, so $36,400 goes untaxed when you are only entitled to $18,200. The tax does not vanish, it just arrives as a bill when you lodge.
Why do I owe money even though I claimed the threshold correctly?
Because each employer withholds as if their job is your only income. Your second employer withholds at the rates for someone earning what they pay you, not at the rate your combined income actually reaches. That gap is the shortfall the calculator shows, and it is normal rather than a mistake.
How much tax will I pay on a second job?
Whatever your marginal rate is once both incomes are combined. On $65,000 plus a $20,000 second job that works out to about 32% on the second job, so roughly $6,425 of the $20,000. Enter your own figures above, since the answer depends entirely on where your first job leaves off.
Can I avoid the bill at tax time?
You can ask your second employer to withhold extra each pay using a PAYG withholding variation, or simply move the estimated shortfall into a separate account as you earn it. Both work. The one that fails is planning to deal with it in October, because by then the money has usually been spent.
Does a second job affect my HECS-HELP repayment?
Yes, and this catches people badly. Repayments are based on your combined repayment income, so two jobs that individually sit below the $69,528 threshold can combine to cross it. Neither employer withholds for a repayment they cannot see, so the whole amount lands with your tax bill.
What if my second job is casual with irregular hours?
The tax treatment is identical, but estimating is harder. Use your best guess at annual earnings and rerun it if your hours change materially. Erring on the high side is the safer mistake, since over-estimating means a refund rather than a bill.
Does it matter which job I call the main one?
Not for your total tax, only for timing. Claiming the threshold at the higher paying job means withholding tracks reality more closely across the year, so the gap at tax time is smaller. The total you owe for the year is exactly the same either way.
What about ABN or contract work on the side?
Different mechanics, same principle. Nobody withholds anything from ABN income, so you set aside the tax yourself and it is all settled at lodgement. Our sole trader tax calculator handles that case, including GST and PAYG instalments.
Can the Medicare levy surcharge apply because of a second job?
Yes. It is assessed on your combined income for surcharge purposes, so two jobs that each look modest can push you above the $105,000 single threshold. If you do not hold private hospital cover, the surcharge is 1% to 1.5% of your income, which is often more than a basic policy costs.
Do I need to tell each employer about the other job?
Not formally, but the Tax File Number declaration is how the system finds out in practice, since answering no to the threshold question signals you have income elsewhere. Employers do not see each other's payroll, which is precisely why the withholding gap exists.
How accurate is the withholding estimate here?
It applies the resident scale to each job the way an employer's payroll would, so it is close. Real withholding varies a little with pay cycle rounding and how each payroll system implements the ATO schedules, so treat the shortfall as a good estimate to budget against rather than an exact figure.
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Disclaimer
This calculator uses 2026-27 Australian resident tax brackets, the low income tax offset, the 2% Medicare levy and its low income shade-in, Medicare levy surcharge tiers from $105,000 for singles, and the 2026-27 HECS-HELP repayment threshold of $69,528. Withholding is estimated by applying the resident scale to each job separately, with or without the tax-free threshold, which approximates what an employer's payroll does but will not match it to the dollar because of pay cycle rounding. It does not model foreign residents' withholding scales in detail, salary packaging, deductions, or income with no withholding such as ABN work. Rates and thresholds are set by the government and change each financial year. This tool provides estimates only and is not financial or tax advice. Confirm current figures at ato.gov.au or speak with a registered tax agent.