Tax Question

[jo172]

Hi all, just a query out of my curiosity.

Last year I worked retail, doing about 16 hours a week for 8 months, 40 hours a week for 2 months and not at all for 2 months. My tax was taken out of my pay from a week to week basis.

I naturally assumed due to the fact that I didn't work for two months my tax liability would have been overestimated by the periods where I worked 40 hours a week and I would be eligible for a tax refund. Yet, now that I work it out, I owe the Tax man about $300, how on earth did this happen?

 

[Simon_Nesbit]

You've got a bad tax accountant?

Do you get any government money? If so, <walrus beard> "there's your problem" </walrus beard>

16 x 34 + 40 x 8 = 864 hours @ $16 = 13,000....without other income you would get ALL of your tax back.

I'm guessing you get Centrelink payments (austudy?), and don't pay any tax from them, and then claimed your 'tax-free threshold' with your employer.

 

[jo172]

You've got a bad tax accountant?

Do you get any government money? If so, <walrus beard> "there's your problem" </walrus beard>

16 x 34 + 40 x 8 = 864 hours @ $16 = 13,000....without other income you would get ALL of your tax back.

I'm guessing you get Centrelink payments (austudy?), and don't pay any tax from them, and then claimed your 'tax-free threshold' with your employer.

Nope, nothing like that.

I earned $12366 and only got $773 taken out of my pay.

 

[bigburger]

From what I can remember from the tax unit I did early this year in summer school it should be something like.

12366 - 6000 = 6366

6366 * 15% = 954.9

Take the low income rebate of $750. Therefore you have to pay 204.90 in tax. If as your say your employee has taken out PAYG amounts totalling 773, you should be getting tax back? I know theres many accountants on Big Footy so if I am wrong (and I probably am) then please correct me. You could also get deductions of Laundry and Maintenance and something else to do with your work.

 

[jo172]

From what I can remember from the tax unit I did early this year in summer school it should be something like.

12366 - 6000 = 6366

6366 * 15% = 954.9

Take the low income rebate of $750. Therefore you have to pay 204.90 in tax. If as your say your employee has taken out PAYG amounts totalling 773, you should be getting tax back? I know theres many accountants on Big Footy so if I am wrong (and I probably am) then please correct me. You could also get deductions of Laundry and Maintenance and something else to do with your work.

Yeah, this is what I got as well.

I'm wondering why on earth the proper amount of tax wasn't originally deducted from my pay as you'd think it would have been taken out at a higher rate at different periods due to my sporadic working pattern!

 

[arakaan]

Yeah, this is what I got as well.

Hang on a second. If you got the same as above why are you saying you owe $300 in the first post.

Do you actually understand what that above post is saying?

 

[Simon_Nesbit]

Bad accountant then. You doing it yourself?

Look up the various low-income rebates...also in retail what claims you can make.

Eg home laundry for any uniforms (embossed with logo or industry specific). Many years ago now, but IIRC it's $1 a week for laundry allowed for 'normal' wear, and $3 for industrial type cleaning (ie overalls, etc).


You should be able to get every cent back pretty easily.

 

[arakaan]

From what I can remember from the tax unit I did early this year in summer school it should be something like.

12366 - 6000 = 6366

6366 * 15% = 954.9

Take the low income rebate of $750. Therefore you have to pay 204.90 in tax. If as your say your employee has taken out PAYG amounts totalling 773, you should be getting tax back? I know theres many accountants on Big Footy so if I am wrong (and I probably am) then please correct me. You could also get deductions of Laundry and Maintenance and something else to do with your work.

no you are correct except he will pay not 1 cent of tax. the 2008-09 tax offset is $1200.
needs to do nothing except fill out the form will income of $12366 and the tax and the 773 will be lobbing in his account.

easiest tax form you'll likely ever do.

 

[bigburger]

no you are correct except he will pay not 1 cent of tax. the 2008-09 tax offset is $1200.
needs to do nothing except fill out the form will income of $12366 and the tax and the 773 will be lobbing in his account.

easiest tax form you'll likely ever do.

Wow thats a big increase. Good to know . At work experience that I am doing MYOB does it automatically and we used the 2007/08 tax brackets and rules for Summer school earlier this year.

 

[year of the roo]

Are you using the eTax program? Throw in a few offsets and deductions and you will get all that tax back. I don't see how you could have made that mistake if you were using eTax, it does all the thinking (maths) for you.

 

[jo172]

Hang on a second. If you got the same as above why are you saying you owe $300 in the first post.

Do you actually understand what that above post is saying?

Ah, read it a second time and now I understand Epic Fail!

Thanks for the help ladies and gents!

 

[Jumpin' Jimmy]

no you are correct except he will pay not 1 cent of tax. the 2008-09 tax offset is $1200.
needs to do nothing except fill out the form will income of $12366 and the tax and the 773 will be lobbing in his account.

easiest tax form you'll likely ever do

Yep, can be seen using ATO ready reckoner.

Start from here, http://calculators.ato.gov.au/scripts/axos/axos.asp?CONTEXT=&KBS=ctax2009.xr4&go=ok


and take about 60 seconds to enter info.

QED

 

[HigginsHawk]

Most payroll systems will not deduct tax when you have worked minimal hours in a week. Eg say you only earn $150 for the next 8 weeks. The program reads this as you only earning $8000 for the year - hence no tax will be deducted. Even though you might have a patch where you earn a few dollars extra, say $600 a week, it will only take out about $70 in tax. It won't go back and say, gees look at all this othr income we had better tax him some more.

Common curse of the casual employee.