Table of Contents

Do I need to lodge a tax return?

Yes, you must lodge a tax return if any of the following apply:

• Tax was deducted from any payments (such as wages) made to you during the financial year.
• You are an Australian resident and your taxable income was more than the tax-free threshold.
• You are a foreign resident and you earned more than $1 in Australia during the financial year.
• You are leaving Australia permanently or for more than one financial year.

Do I need to lodge an Australian tax return in the future?

This may be your last tax return if:

• your annual taxable income in the future will be below the tax-free threshold
• your only source of income in the future will be an Australian Government pension
• you will become eligible for the seniors and pensioners tax offset in the relevant year, and your rebate income is below the threshold for lodging a tax return that year
• you are 60 years old or older and your only source of income is from superannuation benefits (both lump sum and income streams) that have already been subject to tax in the superannuation fund, or
• you are moving overseas permanently

What is the deadline for lodging my tax return?

The Australian income year ends on 30 June. You have from 1 July to 31 October to lodge your tax return for the previous income year. If you use a registered tax agent to prepare and lodge your tax return, you may be able to lodge later than 31 October. You must contact us before 31 October to be included on our lodgement program and to determine whether you are eligible for this concession.

What are the individual tax rates?

These income tax rates show the amount of tax payable in every dollar for each income tax bracket depending on your circumstances.

Residents

These rates apply to individuals who are Australian Residents for tax purposes.

Resident tax rates 2020-2021

The above rates do not include the Medicare levy of 2%.

Resident tax rates 2019-2020

The above rates do not include the Medicare levy of 2%.

See also:

• Medicare levy

Foreign residents

These rates apply to individuals who are foreign residents for tax purposes

Foreign resident tax rates 2020-2021

Foreign resident tax rates 2019–2020

Children

If you are under the age of 18, and receive unearned income (for example, investment income), special rates apply.

See also:

• Your income if you are under 18 years old

Working holiday makers

These rates apply to working holiday maker income regardless of residency for tax purposes.

You are a working holiday maker if you have a visa subclass:

• 417 (Working Holiday)
• 462 (Work and Holiday).

Working holiday maker tax rates 2020-2021

Working holiday maker tax rates 2019–2020

Calculators

A simple tax calculator is available at the ATO to help you calculate the tax on your taxable income.

The Income tax estimator gives you an estimate of the amount of your tax refund or debt, and takes into account:

• the Medicare levy
• higher education loan scheme repayments
• tax offsets
• tax credits.

Tax deducted from your pay

If you want to know how much your employer (or other payer) is required to withhold from payments to you, use the ATO Tax withheld calculator.

Tax rates 2016–17

Your marginal tax rate is the rate of tax you pay on your income for your particular tax bracket.

The above rates do not include the:

• Medicare levy of 2%
• Temporary Budget Repair Levy; this levy is payable at a rate of 2% for taxable incomes over $180,000.

Foreign residents

These rates apply to individuals who are foreign residents for tax purposes.

Tax rates 2016–2017

Foreign residents are not required to pay the Medicare levy.

The above rates do not include the Temporary Budget Repair Levy; this levy is payable at a rate of 2% for taxable incomes over $180,000.

Children

If you are under the age of 18, and receive unearned income (for example, investment income), special rates apply.

Working holiday makers

What is the Medicare Levy?

Medicare gives Australian residents access to health care. It is partly funded by taxpayers who pay a Medicare levy of 2% of their taxable income.

All Australian resident taxpayers are liable to a 2% Medicare Levy, based on their taxable income during the year. The Medicare levy is reduced if your taxable income is below a certain threshold. In some cases, you may not have to pay the levy at all.

Private Health Insurance does not reduce or remove the Medicare Levy, but it does however limit the Medicare Levy Surcharge, which applies to higher income individuals and families who do not maintain eligible Private Hospital Insurance Cover.

What is the Medicare Levy Surcharge?

The Medicare Levy Surcharge is levied on all Australian taxpayers who do not have private hospital cover and who earn above certain pre-determined levels of income that apply to both individuals and families. The surcharge aims to encourage individuals to take out private hospital cover, and where possible, to use the private system to reduce the demand on the public Medicare system.

The surcharge covers you and your dependents. Your dependents include your spouse, any of your children who are under 21 years of age, or any of your student children who are under 25 years of age.

The surcharge rate can vary between 1% – 1.5% of your income depending on your total taxable income. It is in addition to the Medicare Levy of 2%, which is paid by most Australian taxpayers.

What is my marginal rate of tax?

The marginal tax rate is the percentage of tax applied to your income for each tax bracket in which you qualify. In essence, the marginal tax rate is the percentage taken from your next dollar of taxable income above a pre-defined income threshold. It is not an amount that you pay on all your income!

What information do I need to provide you to prepare my tax return?

To complete your tax return you will need to provide the following:

• If you are a new client – a copy of your last return
• Your tax file number
• Your payment summary (group certificate) for all your jobs
• Interest details from all your bank accounts and investments
• Dividend statements and information
• Details of any sale of shares for CGT purposes
• Details of any other income (including foreign income)
• Details of any work-related deductions including travel, uniform, self-education interest and dividend deductions, donations and tax agent fees
• HELP (formerly HECS) debt information
• Spouse details including spouse’s taxable income and related information
• Health insurance policy information
• Bank account details where a refund is expected 

If my return results in a refund, will I recieve a cheque from the ATO? Or will my refund be paid into my bank account?

The Australian Taxation Office no longer issues cheques. All income tax refunds are paid directly into your nominated bank account. You should receive payment within approximately 14 days from the date the return is lodged. We need your financial institution details so that the ATO can pay any refund owing to you directly into your account. Joint accounts are acceptable.

Details required:

• Bank state branch (BSB) number. This is a six digit number which identifies the financial institution
• Account number. This number should not have more than nine characters
• Account name. As it appears on your account statement

What happens if I owe the Australian Taxation Office money?

If your estimated tax assessment indicates that you owe the ATO money, you will receive a notice of assessment together with a tax payment advice from the ATO requesting payment. This can be paid electronically (EFT) or at any post office or by mail.

Why do I have to pay HELP (formerly HECS) in my tax return when I have already paid it during the year from my pay?

Your HELP debt repayment is determined when your end of year income tax return is lodged. It is calculated based on your annual taxable income and at varying rates determined by the level of your adjusted taxable income. You are liable for a HELP debt repayment if your adjusted taxable income exceeds the minimum repayment threshold in the relevant year. If you have made payments or salary deductions through the year, these are treated like an instalment on your taxes. The ATO will match those payments to your tax return and work out whether these instalments are sufficient to cover your HELP liability; whether you need to pay more – or whether you are entitled to a refund.