How do the rates tax work in Australia?

There are many different tax rates in operation in Australia.  For instance, Goods and Services Tax is 10%.  This is the tax on ‘taxable supply’ purchases of general goods and services when the supplier is registered for GST.  Some of the other key tax rates in Australia company tax and personal income tax.  Company tax  runs at 30% in Australia which is actually wuite competitive when compared with other western industrialised economies.  Another key tax in Australia is the tax on the income of complying superannunation funds which is only 15%.   In terms of tax brackets, tax brackets apply to personal income tax.  In Australia, the present brackets for income tax break down as follows:

Taxable income                                     Tax on this income

$1 – $6,000                                                   Nil

$6,001 – $34,000                                     15c for each $1 over $6,000

$34,001 – $80,000                                  $4,200 plus 30c for each $1 over $34,000

$80,001 – $180,000                               $18,000 plus 40c for each $1 over $80,000

$180,001 and over                                   $58,000 plus 45c for each $1 over $180,000

Although this calculation should seem quite simple, the complicated aspect of taxation is often identifying how different payments apply in particular circumstances and working our what types of payments are deductions are what are not allowable deductions.  There can also be difficulties in relation to capital gains tax in valuing the asset over which the capital gain is calculated.  Also a capital gain in a particular year can create an accounting nightmare in relation to the calculation of the capital gain as income.  This is because a net capital gain accrues as income in the year that the capital gain is realised and becomes part of the personal (or company) income tax which must be paid.  There are also possibly some CGT discounts which can apply in relation to small business which, although helpful to small business, can also add another layer of complexity to an already insanely complicated system of taxation regulation.   If you have a query in relation to taxation rules and regulations, you can contact one of our taxation lawyers to get an opinion on the part of the taxation law which you need some guidance on.  Many are avaialble to chat 24 hours per day and can chat with you on weekends if necessary as well.  If they are not available, you can enter your taxation law question into the contact form to the right or to the question bow below.