How Much Tax You’ll Need To Pay

The tax calculator will show you how much tax you need to pay based on your annual income. You can then compute how much tax you should get back in your tax return, or how much you owe the Australian Tax Office (ATO).  The income tax calculator is simple to use. First step is, you’ll need to know your gross annual income. This is your income before any deductions or taxes (gross payments) and you can find this figure on your payment summary, group certificate or pay slip. Once you enter this figure into the calculator, you’ll receive two results. You will see your net annual income, which is the income you receive after PAYG tax has been deducted, and how much tax you'll need to pay based on the income you've stated. The tax calculator Sydney will tell you how much tax you'll need to pay. If you've paid more tax than you need to (as stated on your group certificate or payment summary as the amount of tax withheld) you should get the difference back as a tax return. Alternatively, if you have not paid the correct amount of tax you will need to make up the difference and pay this to the ATO. Just make sure you are looking at the correct financial year when using the tax calculator Sydney. Each year, income tax rates depend on your income and your residency status. Non-residents are taxed at a high rate and are not entitled to a tax-free threshold. So if you're a non-resident, you'll need to pay tax on all income earned from an Australian source. Owing how much tax you’ll pay in a year will help you to budget accurately and to plan your tax strategies. Remember that when planning your tax strategies, you should always seek the advice of a tax expert such as an accountant.

Income that is taxable

Income that you must pay tax on includes money from:

·         Employment

·         Pensions and annuities

·         Most government payments

·         Investments

·         Capital gains

·         Income from trusts, partnerships or businesses

·         Foreign income

Income that is not taxable

You will not have to pay tax on:

·         Lottery winnings and other prizes

·         Small gifts or birthday presents

·         Some government payments

·         Child support

·         The tax-free portion of your redundancy payment

·         Government super co-contributions

Moreover, most people will also have to pay a Medicare levy. The Medicare levy is calculated as 2% of your taxable income. It is used to help fund our public health system. Basically, it allows you to visit a doctor or receive treatment at a public hospital free of charge. Low income earners may have their Medicare levy reduced or may not have to pay it at all. People not entitled to use our Medicare system, such as foreign residents, will not have to pay the Medicare levy either. High income earning individuals or families who do not have an appropriate level of private patient hospital cover may have to pay a Medicare levy surcharge. The Medicare levy is deducted as part of your income tax and forwarded to the tax office on your behalf.