Know Your Income Tax in Australia

Current Tax Breaks

To offset the impact of the introduction of GST (Goods and Service Tax) in 2000, the Commonwealth has assisted those who buy or build their first homes through the State and Territories by offering a one-off payment of $7,000 FHOG (First Home Owner Grant). There have been additional payments of $7,000 or $3,000 for building contracts signed before Jun 2002 and completed by Jun 2004. If you have missed out in the early years and you are buying or building your first home now, you can still be eligible for the $7,000 FHOG. The grant is not taxable. The applicant

is not subject to any means test, other than to meet a few criteria on resident status, ownership and occupancy. For application, please check the Revenue Office in your State.

If you are a low or middle income earner, you may be eligible for the Government Superannuation Co-contribution. The Government will match a dollar fifty cents up to a maximum of $1,500 p.a. to every dollar of your personal contribution. If you are a permanent resident aged less than 71, your total income is less than $58,000 and more than 10% of your income comes from employment, you may be eligible for the co-contribution. Any income in excess of $28,000 will have the maximum co-contribution reduced by 5 percent on the excess. For further details, please visit ATO.

From 1 Jul 2006, if your total taxable income is below $40,000, you may be eligible for a tax rebate. The maximum tax rebate is $600 for those earning $25,000 or less. The tax rebate will be scaled back for any amount in excess of $25,000 by 4%.

Australian Income Tax

The fiscal year end in Australia is 30 Jun. Below does not include 1.5% medicare levy. Non-residents do not have to pay medicare levy.

Income tax rate for 2006-07 :
Taxable income / Tax rate for residents / Tax rate for non-residents
$0 – $6,000 / Nil / 29%
$6,001 – $25,000 / 15% / 29%
$25,001 – $75,000 / 30% / 30%
$75,001 – $150,000 / 40% / 40%
Over $150,000 / 45% / 45%

Above currency is in AUD.