With the end of Australia’s tax year on the 30th June, we now herald the start of a fresh year, and for the first time ever we now see the top marginal rate in Australia only on taxable incomes above A$180,000.
For many expatriates and intended migrants, this will be great news as it is a far cry from the recent past where the top rate applied on incomes above only A$62,500 as recently as June 2004.
This dramatic change was begun by the Howard Government and reaffirmed by the new Rudd Government in this years budget.
The new rates tax effect from 1st July 2008 and will be welcomed by Australian taxpayers, seeking some relief from recent interest rate rises and fuel price hikes.
For an Australian resident earning A$80,000 per annum, the reductions are worth A$1,100 per year.
Prior to 30th June 2008 |
From 1st July 2008 | ||||
Taxable Income Bracket (Marginal Tax Rates Apply) |
Resident Tax Payers |
Non Resident Tax Payers |
Taxable Income Bracket (Marginal Tax Rates Apply) |
Resident Tax Payers |
Non Resident Tax Payers |
A$0 to $6,000 |
Nil |
29% |
A$0 to $6,000 |
0% |
29% |
A$6,001 to A$30,000 |
15% |
29% |
A$6,001 to A$34,000 |
15% |
29% |
A$30,001 to A$75,000 |
30% |
30% |
A$34,001 to A$80,000 |
30% |
30% |
A$75,001 to A$150,000 |
40% |
40% |
A$80,001 to A$180,000 |
40% |
40% |
Above A$150,001 |
45% |
45% |
Above A$180,001 |
45% |
45% |
There are further reductions scheduled to come in to effect on the 1st July 2010, when the 40% rate will be reduced to 37%. In his election announcements Prime Minister Rudd has also committed to have the top rate reduce to 40% by the 2013 year.
With the end of the tax year, we now begin our requirement to lodge your Australian income tax returns, so if you have earned any Australian rental income or moved overseas during the year, remember to attend to this.
Failure to lodge can result in fines of A$550 per person per year, so contact your local ATS office and we will be happy to assist you with this and keep your Australian Tax affairs in order.
