[Ben-HH]

Hi

Has anyone got any experience how to claim the tax-free threshold or how does it works?
From what I understood is the first $18,200 you earn per financial year tax free. After that you will be taxed according to your income.

I assume that the tax-free threshold can be taken into account either each months (i.e. you pay less tax every month) or you can claim the tax back at the end of the financial year. Is that correct?

Any ideas would be great as the equivalent links on the ato.gov.au website currently don't work.

Cheers

 

[ozbound12]

Hi Has anyone got any experience how to claim the tax-free threshold or how does it works? From what I understood is the first $18,200 you earn per financial year tax free. After that you will be taxed according to your income. I assume that the tax-free threshold can be taken into account either each months (i.e. you pay less tax every month) or you can claim the tax back at the end of the financial year. Is that correct? Any ideas would be great as the equivalent links on the ato.gov.au website currently don't work. Cheers

Tax is withheld from your pay and if you have paid too much, you will get a refund when you file your tax return.

 

[Ben-HH]

Tax is withheld from your pay and if you have paid too much, you will get a refund when you file your tax return.

Thanks. I understand general taxing. My question is how do I make use of the threshold before my tax return. Here is what ATO says:

"If you are an Australian resident for tax purposes, the first $18,200 of your yearly income is not taxed. This is called the tax-free threshold. Therefore, by claiming the threshold, you reduce the amount of tax that is withheld from your pay during the year."

 

[ozbound12]

Thanks. I understand general taxing. My question is how do I make use of the threshold before my tax return. Here is what ATO says: "If you are an Australian resident for tax purposes, the first $18,200 of your yearly income is not taxed. This is called the tax-free threshold. Therefore, by claiming the threshold, you reduce the amount of tax that is withheld from your pay during the year."

By telling your employer how much or how little to withhold from your pay.

 

[Scattley]

When you complete your salary forms when you start a job one is for the ATO...you tick "yes" for do you wish to claim the tax free threshold (you can only tick this for one job if you are doing two at the same time). Then a calculation is made with your salary...if you get $X that fortnight how much do you earn for a year..then they world out the tax per fortnight. It's not that you do not pay any tax per fortnight until you have earnt 18k.. If you earn more than 18k/52 you will get taxed each pay

 

[Ben-HH]

When you complete your salary forms when you start a job one is for the ATO...you tick "yes" for do you wish to claim the tax free threshold (you can only tick this for one job if you are doing two at the same time). Then a calculation is made with your salary...if you get $X that fortnight how much do you earn for a year..then they world out the tax per fortnight. It's not that you do not pay any tax per fortnight until you have earnt 18k.. If you earn more than 18k/52 you will get taxed each pay

Awesome. That is the information I was looking for. Thanks a lot.

 

[ozbound12]

When you complete your salary forms when you start a job one is for the ATO...you tick "yes" for do you wish to claim the tax free threshold (you can only tick this for one job if you are doing two at the same time). Then a calculation is made with your salary...if you get $X that fortnight how much do you earn for a year..then they world out the tax per fortnight. It's not that you do not pay any tax per fortnight until you have earnt 18k.. If you earn more than 18k/52 you will get taxed each pay

The tax is withheld regardless since they are required to do so by law. Everyone gets taxed even if you are claiming the threshold.

 

[Scattley]

The tax is withheld regardless since they are required to do so by law. Everyone gets taxed even if you are claiming the threshold.

Not everyone gets taxed. If you earn less than $300 a week you do not get taxed. My job has an additional 16k tax free threshold attached to it, so some of our very part time staff pay no tax at all.

 

[ozbound12]

Not everyone gets taxed. If you earn less than $300 a week you do not get taxed. My job has an additional 16k tax free threshold attached to it, so some of our very part time staff pay no tax at all.

Yes but if you are starting a job where your annual salary is say $70k and your pay for the financial year is under the threshold, you will still be taxed as though you are earning $70k for a full year. You then get a refund when you file your return.

 

[Scattley]

Yes but if you are starting a job where your annual salary is say $70k and your pay for the financial year is under the threshold, you will still be taxed as though you are earning $70k for a full year. You then get a refund when you file your return.

Bit confused....that was what I said? I thought you were disagreeing with my post.