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  • Tax in Australia:What you need to know

    Why we pay tax

    Tax is money people and businesses pay to the Australian Government to provide services including:

    • health
    • education
    • defence
    • roads and railways
    • social security and other payments from Centrelink.

    As Australians we enjoy access to a good health system, quality education and a variety of community facilities (for example parks and playgrounds) which are supported through tax collections.

    Permission to work in Australia

    If you are a foreign resident, you must get permission from the Department of Home Affairs before you start work in Australia. Home Affairs can provide you with useful information including which visas allow you to work in Australia.

    For more information about permission to work in Australia contact Home Affairs.

    Next step:

    How much tax you will pay

    The amount of tax you pay depends on:

    • whether you are an Australian resident for tax purposes
    • how much income you earn
    • if you have a tax file number (TFN) - this is a personal identity number which you should tell your employer.

    If you begin work before you have a TFN, you have 28 days to get one and give it to your employer. If you don't, your employer must take tax from your pay at the highest rate.

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    Lodging a tax return

    You need to lodge a tax return to tell us:

    • how much income you have earned from working, or from interest on bank accounts or investments
    • how much tax has been withheld, so how much money is taken out of your pay by your employer and sent to us
    • any deductions you are claiming.

    To lodge your return, you will need a payment summary. Every employer you work for must provide you with a payment summary by 14 July after the tax year or when you leave them.

    Contact your employer if you have changed your address.

    Generally, you will need to lodge a tax return if you pay tax during the financial year. If you’re unsure whether you need to lodge, use our Do I need to lodge a tax return tool below to find out.

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    When you lodge

    If you are preparing and lodging your own tax return, you must lodge it by 31 October. If you are using a tax agent for the first time or a different agent to last year, you must contact them by 31 October.

    If you don't lodge your tax return and pay any amounts you owe us, you may have to pay penalties.

    Work-related expenses

    Work-related expenses may be tax deductible if you have spent money on something to help you earn your income. You must be able to show that:

    • expenses directly relate to earning income
    • expenses are not private in nature
    • you have a record to prove your expenditure.

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    Record keeping

    When you lodge your tax return, we process it and work out whether you have paid the right amount of tax. We let you know the result by sending you a notice of assessment. Generally, you must keep records such as receipts for any deductions you claim for at least five years from the date you lodge your tax return.

    See also:

    Last modified: 03 Dec 2018QC 57521