Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 405 - Above-average special professional income of authors, inventors, performing artists, production associates and sportspersons  

Guide to Division 405  

SECTION 405-5   Special rate of income tax on your above-average special professional income  

405-5(1)    
If you have above-average special professional income, the Income Tax Rates Act 1986 generally sets a special rate so that the amount of income tax you pay on the top 4 / 5 of your above-average special professional income is effectively 4 times what you would pay on the bottom 1 / 5 of that income at basic rates.

Note:

Your overall income tax will be less only if 2 marginal rates of income tax would apply to your above-average special professional income if it were treated as the top slice of your taxable income.

405-5(2)    
The following diagram illustrates how the special rate works.