Tax Knowledge = Financial Power
Understanding how tax works!
If you want to know how to get your tax back, you need to know how the Tax Office took it off you in the first place.
In Australia we have a ‘marginal tax system’. This basically means that the more you earn, the more tax you pay. At the time of writing, the ATO website stated that those brackets for Australian residents in 2023/2024 were as follows:
Figure: The Australian Tax Office’s Tax Tables for 2023/2024
We are always amused by the people who say they ‘don’t want a pay rise because it will put them into the next tax bracket’. The good news is that it doesn’t work like that!
If you get a pay rise from $120,000 to $125,000, while you do move up a tax bracket, you’re not going to pay 37% tax on the whole lot. You’ll only pay 37% on the portion over $120,000.
Next up we are going to cover the good stuff: how property can reduce your tax!
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