By Jason Given · April 2026 · 5 min read
The revised Stage 3 tax cuts reduced the 19% tax rate to 16% and the 32.5% rate to 30%, benefiting most income brackets. For borrowers, the impact goes beyond the extra cash in your pocket — it directly increases the amount lenders will approve because they assess your net income after tax.
For a single income of $90,000, the tax cut adds approximately $1,900 per year in take-home pay. For a dual-income household earning $180,000 combined, the benefit is roughly $4,500 per year. Lenders convert this additional net income into borrowing capacity using their serviceability calculators.
An extra $4,500 per year in net income typically translates to $25,000–$35,000 in additional borrowing capacity. That might not sound transformative, but for buyers who are right on the edge of affordability — particularly first home buyers — it can be the difference between qualifying and missing out.
If you received a pre-approval before the tax cuts took effect, it is worth getting a fresh assessment. Your capacity has increased and a new pre-approval will reflect this.
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The Stage 3 tax cuts increased take-home pay for most income brackets. A household earning $150,000 combined takes home approximately $4,500 more per year. Translated to borrowing capacity, this adds roughly $25,000–$35,000 to what lenders will approve — the exact figure depends on the lender and your other commitments.
Yes — lenders update their serviceability calculators when tax rates change. If you were assessed before the cuts took effect, your borrowing capacity has increased. A fresh assessment will reflect the higher net income. This is one reason to get a current pre-approval rather than relying on an older one.