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Income Tax in Australia
A resident taxpayer in Australia who earns $18,200 or under, in the year, will pay NO tax on that income.
If the annual income is $37,000 then the tax payable is $3,572. This is 9.65%.
At an income of $80,000 the tax will be $17,547. This is 21.93%.
For a higher earner at $180,000 the tax will be $54,547. This is 30.30%.
2014-2015 Tax Rates for Earners classed as Tax-Resident
|Taxable income||Tax on this income|
|0 – $18,200||Nil|
|$18,201 – $37,000||19c for each $1 over $18,200|
|$37,001 – $80,000||$3,572 plus 32.5c for each $1 over $37,000|
|$80,001 – $180,000||$17,547 plus 37c for each $1 over $80,000|
|$180,001 and over||$54,547 plus 45c for each $1 over $180,000|
This does NOT include the Medicare Levy
Tax File Numbers
Every income earner in Australia should have a tax reference number, called a Tax File Number, and when this is quoted to Employees and Banks (for interest payments), etc., tax is deducted from income at the current rates.
If a Tax File Number (TFN) is not quoted, then tax is deducted at the maximum rate.
You can apply for a tax file number (TFN) online only if you are currently in Australia and you have:
- a valid permanent migrant visa, or
- a valid visa with work rights, or
- a valid overseas student visa, or
- a valid visa allowing you to stay in Australia indefinitely.
Every taxpayer must complete an Annual Tax Return, and this calculates any differences in tax over or under paid.
Most people need to submit their Tax return by the last day of October each year, but there are extensions for those who lodge via a Tax Agent.
Some Non-Tax payers should also complete an annual Tax Return, as they may be entitled to a rebate, even without paying anything.
Most Australians end up paying more tax, during the year, than they should, due to various allowances being only claimable at the end of the year, such as Sun Screen protection for outside workers, overtime meal allowance, and various other allowances, and they end up receiving a Tax Rebate shortly after submitting the Annual Tax Return. (This is often within 14 days).