About the Company Tax Calculator
A Company Tax Calculator Australia helps businesses estimate their corporate income tax liability for the current financial year. Understanding your company tax obligations is essential for cash flow forecasting, dividend planning, and meeting ATO payment schedules. Australian companies pay tax on their taxable income at either the base rate (25%) for base rate entities or the corporate rate (30%) for all other companies. Determining which rate applies depends on your aggregated turnover and the proportion of your income that is passive. Using a reliable company tax calculator ensures you set aside the right amount for tax and avoid unexpected bills at lodgement time.
What is the Company Tax Calculator?
The Company Tax Calculator is a financial tool that estimates the income tax payable by an Australian company based on its estimated taxable income, applicable tax rate, and available offsets and credits. The Australian corporate tax system uses a two-tier rate structure. For the 2025-26 income year, a base rate entity (with aggregated turnover below $50 million and no more than 80% passive income) pays tax at 25%. Companies that do not meet the base rate entity criteria pay tax at 30%. The calculator accounts for key variables including estimated taxable income, franking credits on dividends received, research and development tax offsets, and Pay As You Go (PAYG) instalments already paid during the year. It also considers the lower company tax rate for small and medium businesses, the small business income tax offset (for unincorporated entities), and the ability to carry forward prior year losses. Taxable income is calculated after deducting all allowable business expenses including salaries, rent, marketing, depreciation, interest, and superannuation contributions. The calculator provides both the estimated tax payable and the effective tax rate as a percentage of taxable income.
How to Use This Calculator
- 1Enter your estimated taxable income: Input the company's expected taxable income for the financial year after all allowable deductions.
- 2Select your company type: Choose between base rate entity (turnover under $50 million, less than 80% passive income) or other company (30% rate).
- 3Enter any prior year losses: If your company has carried-forward tax losses from previous years, enter the amount to reduce current-year taxable income.
- 4Add research and development tax offset: If eligible, enter your R&D expenditure. The calculator applies the appropriate refundable or non-refundable offset.
- 5Enter PAYG instalments already paid: Input any quarterly or annual PAYG instalments paid to the ATO during the year.
- 6Include franking credits: If your company received franked dividends, enter the franking credits to be included in assessable income.
- 7Click Calculate: The tool shows your estimated tax payable, the balance due after PAYG credits, and your effective tax rate.
Worked Australian Example
Practical Example
Consider Melborne-based digital agency, Yarra Digital Solutions Pty Ltd, operating in Victoria. For the 2025-26 financial year, the company has estimated total income of $2,800,000 and allowable deductions of $1,950,000, giving a taxable income of $850,000. Yarra Digital has an aggregated turnover of $2.8 million and earns less than 80% passive income, qualifying as a base rate entity. Using the Company Tax Calculator, the director Priya enters the taxable income of $850,000 and selects base rate entity. The calculator applies the 25% rate, giving a gross tax of $212,500. The company has paid quarterly PAYG instalments totalling $180,000 during the year, and has $15,000 in franking credits from dividends received. The calculator shows a net tax payable of $17,500 ($212,500 − $180,000 − $15,000). Priya also checks a scenario where turnover exceeds $50 million — the calculator shows the rate would switch to 30%, resulting in gross tax of $255,000 and a net payable of $60,000. This exercise helps Priya understand the financial impact of rapid growth and plan for the tax implications of scaling the business. She also reviews the company's franking account balance and decides to declare a fully franked dividend to shareholders.
How Our Company Tax Calculator Works
Australian company tax is a **flat rate on taxable income** — there are no progressive brackets like personal tax. The calculator applies whichever of the two rates fits the company: - **25% base rate** — for a **base rate entity**: a company with aggregated turnover under $50 million whose passive income (interest, rent, dividends) is no more than 80% of its total income. - **30% general rate** — for all other companies, including larger businesses and those that are mainly passive-income vehicles. **Company tax = taxable income × applicable rate**, where taxable income is assessable income minus allowable deductions. The distinction matters because most active small businesses qualify for the lower 25% rate, while investment-heavy companies pay 30%. Company tax is also the foundation of Australia's **dividend imputation** system: tax the company pays generates franking credits, which shareholders can use to offset their own tax on dividends — so company tax isn't always a final cost to the owners. The calculator gives the company-level liability; it doesn't model franking or the personal tax that follows when profits are distributed. Rates and the base-rate-entity test are set by the ATO.
When to Use This Calculator
Use this whenever you need to estimate a company's tax position. **At year-end or quarterly**, to project the tax payable on expected profit and set aside funds or plan PAYG instalments. **When deciding whether you're a base rate entity**, since the 25% vs 30% question hinges on turnover and passive-income share — worth checking as the business grows or its income mix changes. **When comparing structures**, to weigh a company's flat rate against personal marginal rates (the sole-trader-vs-company calculator digs into this). **When modelling reinvestment vs distribution**, to see the company-level cost before franking. It's built for directors, small business owners and their advisers who want a fast, rate-accurate estimate rather than a full tax return.
Common Company Tax Calculator Questions
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