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  • When to work out the study and training support loans component

    You will need to calculate the study and training support loans component when your employee has given you a Tax file number declaration or Withholding declaration and has:

    • answered yes to the question on whether they have a
      • Higher Education Loan Program (HELP) debt
      • VET Student Loan (VSL) debt
      • Financial Supplement (FS) debt
      • Student Start-up Loan (SSL) debt (including ABSTUDY SSL debts)
      • Trade Support Loan (TSL) debt
       
    • not completed a Medicare levy variation declaration claiming a reduction or exemption in the Medicare levy for having a spouse or dependants and low family income
    • claimed the tax-free threshold or is a foreign resident with earnings of one of the following
      • $882 or more if paid weekly
      • $1,764 or more if paid fortnightly
      • $3,822 or more if paid monthly
      • $11,466 or more if paid quarterly.
       

    If your employee has not claimed the tax-free threshold, the study and training support loans component is calculated on earnings of:

    • $532 or more if paid weekly
    • $1,064 or more if paid fortnightly
    • $2,305.33 or more if paid monthly
    • $6,916 or more if paid quarterly.

    You must withhold the study and training support loans component from all your employee's earnings, including taxable allowances, bonuses and commissions.

    Examples:

    1. Employee has claimed the tax-free threshold and has weekly earnings of $1,095.84.
      Study and training support loans component = $1,095.99 × 2.5% = $27.00 rounded to the nearest dollar.
    2. Employee has claimed the tax-free threshold and has fortnightly earnings of $2,355.78.
      Weekly equivalent of $2,355.78 = $1,177.99 ($2,355.78 ÷ 2, ignoring cents and adding 99 cents).
      Weekly study and training support loans component = $1,177.99 × 3% = $35.00 rounded to the nearest dollar.
      Fortnightly study and training support loans component = $70.00 ($35.00 × 2).
    3. Employee has claimed the tax-free threshold and has monthly earnings of $5,488.45.
      Weekly equivalent of $5,488.45 = $1,266.99
      ($5,488.45 × 3 ÷ 13, ignoring cents and adding 99 cents).
      Weekly study and training support loans component = $1,266.99 × 3.5% = $44.00 rounded to the nearest dollar.
      Monthly study and training support loans component = $191.00 ($44.00 × 13 ÷ 3, rounded to the nearest dollar).
    End of example

    Do not withhold any amount for study and training support loans debts from lump sum termination payments.

    Rounding of withholding amounts

    Withholding amounts calculated as a result of applying the above formulas are rounded to the nearest dollar. Values ending in 50 cents are rounded to the next higher dollar. Do this rounding directly – that is, do not make a preliminary rounding to the nearest cent.

    Accounting software

    Software written in accordance with the formulas in this schedule should be tested for accuracy against the sample data provided at Tax tables. The results obtained when using the coefficients in this schedule may differ slightly from the sums of the amounts shown in the PAYG tax tables. The differences result from the rounding of components.

    Last modified: 14 Jun 2019QC 59029