The Australian Government implemented the Household Assistance Package to help low and middle income families under its Clean Energy Future initiative.
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For information about the:
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How are your employer obligations affected?
From 1 July 2012, you need to use updated tax tables to ensure that you withhold the correct amount.
From the first pay period your employees may notice an increase in their take-home pay due to a reduction in the amount of tax withheld. This is because of changes to the tax-free threshold and personal income tax rates.
How do changes to the tax-free threshold affect your employees?
From 1 July 2012, employees who:
- claim the tax-free threshold and who earn less than $80,000 annually will have less tax withheld from their pay
- do not claim the tax-free threshold will have more tax withheld from their pay.
An employee can only claim the tax-free threshold from one employer at a time, generally from their main source of income.
However, if an employee is receiving income from more than one source at the same time and expect their total income for the year to be less than $18,200 they may claim the tax free threshold from each payer.
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For more information about the tax-free threshold, refer to:
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If your employee believes that for their circumstances, the amount you withhold will be excessive, they may apply to us for a variation to reduce the rate of withholding.
For more information, refer to PAYG withholding - varying your PAYG withholding (NAT 70791).
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What changes are being made to the tax rates?
Table 1: 2011-12 tax rates (not including Medicare and flood levies)
Taxable income
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Tax rate
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$0 - $6,000
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0%
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$6,001 - $37,000
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15%
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$37,001 - $80,000
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30%
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$80,001 - $180,000
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37%
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$180,001+
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45%
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Table 2: 2012-13 tax rates (not including Medicare levy)
Taxable income
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Tax rate
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$0 - $18,200
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0%
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$18,201 - $37,000
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19%
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$37,000 - $80,000
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32.5%
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$80,001 - $180,000
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37%
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$180,001+
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45%
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From 1 July 2012, the temporary flood and cyclone reconstruction levy (flood levy) no longer apply.
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Are there tax changes for employees who are non-residents for tax purposes?
Personal income tax rates for foreign residents (non-residents) for tax purposes have changed to align with the tax changes for residents.
From 1 July 2012, the first marginal tax rate for a non-resident is the same as the second marginal tax rate for a resident. Income up to $80,000 will be taxed at 32.5 percent, increasing to 33 percent from 1 July 2015.
How are employees who are under 18 affected?
There is no requirement for employees who are under 18 years of age to provide you with their tax file number (TFN) provided that the payment you make to them does not exceed:
- $350 per week (if you pay weekly)
- $700 per fortnight (if you pay fortnightly)
- $1,517 per month (if you pay monthly).
How do you get the 2012-13 tax tables?
A full list of updated tax tables is available. A tax withheld calculator is also available to help you work out the correct amount of tax to be withheld from payments made to most employees.
How do your employees claim tax offsets?
If you have an employee who chooses to claim their entitlement to a tax offset through reduced withholding, they must provide you with a Withholding declaration.
Do you need to provide a payment summary to all your employees?
You are required to provide a payment summary to each of your employees when making payments to them even if you were not required to withhold.
More information
For more information:
Last Modified: Tuesday, 21 August 2012