The Low and Middle Income Tax Offset (LMITO) was a temporary tax offset that applied in Australian income tax returns from FY2018–19 to FY2021–22. It provided up to $1,500 in tax relief for individuals earning between $37,001 and $126,000. LMITO was introduced as part of the federal government’s three-stage income tax reform plan and was always intended to be temporary. It was not extended after FY2021–22.
What LMITO Was
LMITO was an offset applied in addition to the permanent Low Income Tax Offset (LITO). At its peak (FY2021–22), eligible individuals received up to:
| Taxable income | LMITO entitlement |
|---|---|
| $0 – $37,000 | $255 |
| $37,001 – $48,000 | $255 + 7.5% × (income − $37,000) |
| $48,001 – $90,000 | $1,500 (maximum) |
| $90,001 – $126,000 | $1,500 − 3% × (income − $90,000) |
| Over $126,000 | $0 |
The $1,500 maximum was available for incomes between $48,001 and $90,000.
History of LMITO
LMITO was legislated under the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Act 2019. It was originally worth up to $1,080 per year, before being temporarily increased to $1,500 for FY2020–21 and FY2021–22 as part of COVID-19 economic support.
| Financial year | Max LMITO |
|---|---|
| FY2018–19 | $530 |
| FY2019–20 | $1,080 |
| FY2020–21 | $1,080 (legislated); increased to $1,500 retrospectively |
| FY2021–22 | $1,500 |
| FY2022–23 and beyond | $0 — LMITO ended |
Why LMITO Ended
LMITO was always temporary — it was designed as a bridge measure while the federal government’s Stage 3 tax cuts were implemented. Stage 3 tax cuts, which took effect from 1 July 2024, reduced the 32.5% tax rate to 30% and adjusted tax brackets, providing ongoing structural tax relief. With Stage 3 in place, LMITO was not renewed.
The government announced in the March 2022 budget that LMITO would not be extended beyond FY2021–22, despite significant advocacy from some quarters to make it permanent.
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Frequently Asked Questions
Can I still claim LMITO in my 2023 or 2024 tax return? No. LMITO applied only to FY2018–19 through FY2021–22. If you need to amend a return from one of those years, it may still be relevant — but for FY2022–23 and later returns, LMITO does not exist.
Did everyone get $1,500 from LMITO? No. The $1,500 maximum applied to those earning between $48,001 and $90,000. Lower earners received a smaller amount (minimum $255 for those earning under $37,000). Higher earners between $90,001 and $126,000 received a reduced amount phasing to zero at $126,000.
Will LMITO come back? LMITO has not been reintroduced as of FY2025–26. The ATO and Treasury have not signalled any plans to bring it back. Ongoing tax relief is now delivered through the permanent LITO and the Stage 3 tax bracket changes.
This article provides general tax information only. For advice tailored to your situation, speak with a registered tax agent. Find one through the Tax Practitioners Board register or visit MoneySmart.