| Individual rates |
| Taxable income ($) |
Tax payable ($) |
| 0 - $18,200 |
Nil |
| $18,201 - $37,000 |
Nil + 19% of excess over $18,200 |
| $37,001 - $87,000 |
$3,572 + 32.5% of excess over $37,000 |
| $87,001 - $180,000 |
$19,822 + 37% of excess over $87,000 |
| $180,001+ |
$54,232 + 47% of excess over $180,000 |
| How much income tax should a person pay earning the following taxable incomes? |
Select from these options |
Comment |
| 1. Taxable income of $35,000: |
Nil |
CommentTax is due as income is over $18,200.. |
| $3,192 |
CommentCORRECT:
19%×($35,000-$18,200).. |
| $3,572 |
CommentCannot use the maximum for the income scale unless the income was exactly $37,000.. |
| $6,650 |
CommentThe 19% does not apply to the first $18,200 of the income. In tax for companies, it is different.. |
| 2. Taxable income of $65,000: |
$3,572 |
CommentThis is the tax for an income of $37,000. The extra tax to $65,000 must also be included.. |
| $9,100 |
CommentThe base tax up to $37,000 must also be added - so
32.5%×(65,000-37,000) PLUS $3,572.. |
| $12,672 |
CommentCORRECT.. |
| $19,822 |
CommentThe $19,822 only applies to an income at the top of this scale - so to $87,000.. |
| 3. Taxable income of $100,000. |
$4,810 |
CommentThis is the tax for the difference between $100,000 and $87,000. Now add the tax up to $87,000 which is $19,822.. |
| $19,822 |
CommentCannot use just the minimum tax for this scale - also add the tax on the difference between the income and $87,000.. |
| $24,047 |
CommentIncorrect tax rate used for this scale - the 37% rate should be used.. |
| $24,632 |
CommentCORRECT.
$19,822 + 37%×($100,000-$87,000).. |
| 4. Taxable income of $195,000. |
$7,050 |
CommentThis is the tax for the difference between $195,000 and $180,000. Now add the tax up to $180,000 which is $54,232.. |
| $54,232 |
CommentCannot use just the minimum tax for this scale - also add the tax on the difference between the income and $87,000.
47%×($195,000 - $180,000).. |
| $59,782 |
CommentIncorrect tax rate used for this scale - the 47% rate should be used.. |
| $61,282 |
CommentCORRECT.
$54,232+($195,000-$180,000)× 47%. |
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5. Alex earns a salary of $120,000 p.a. and has allowable deductions of $6,356.
Use the table above to calculate the amount of income tax Alex will pay (not including the Medicare Levy).
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6. |
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7. Phoebe earned a gross annual salary of $112,500 in 2020-21 and her employer paid $27,500 PAYG tax on her behalf.
Phoebe calculated that her total allowable deductions
were $2,500 for work-related travel, $800 for work related phone calls and $650 for professional subscriptions.
Phoebe must pay the Medicare Levy (of 2%) on her taxable income.
Using the tax table provided by the ATO above, determine Phoebe's tax refund or tax liability.
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8. For the financial year relevant to the above tax table, Norman must pay $18 253.88 in tax.
Calculate the amount of the Medicare Levy (1.5%) based on Norman's taxable income.
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9. Tobing had a taxable income in the last financial yer of $97,500. Throughout that year, he paid $2,000 per month in PAYG (Pay As You GO) tax.
Ignoring the Medicare Levy, calculate how much refund Tobing is entitled to or how much he still owes the Tax Office.
AnswerRefund of $293.. |
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10. Brittany paid $15,454.65 in income tax last financial year (excluding the Medicare Levy).
Using the table above, calculate her taxable income?
AnswerTaxable income was $73,562.. |
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11. Sara travelled 6,300 km on work-related travel this financial year.
Calculate the tax deduction she is entitled to if she can claim 42.6 c/km in her tax return.
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12. Charles determines that he wants to limit his tax bill to $73,500. If he does not take deductions into account, what salary would Charles have to earn to limit his bill to that amount?
Answer $220,995.74. |
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