Tax Return Tips For People With Their Own ABN
Usually a sore subject, some companies that you work for will ask you get your own Australian Business Number (ABN), they’ll pay you an amount and it’s up to you to sort your own tax out. This is not the right way in most cases and is simply done because the employer is too lazy to go through the administrative work of payroll. One of the first questions the ABN application asks you is “do you run your own business?”. If the answer is no (most commonly the case) then you are not allowed to apply for an ABN. But we get a lot of people who had no choice but to get an ABN to be paid. So what happens to these earnings? Basically it needs to be included in your tax return together with any other income (such as your income from employment or interest) after the end of financial year (June). When you lodge your tax return, all your income will be added up and the tax will be assessed based on the combined income. If you are a full year tax resident and if your total income is below $18,200, you don’t need to pay any tax – meaning you get a full refund of tax you paid during the year. If you earned over the tax free threshold then you will either not get all your tax back or even have to pay more tax as a result of your Australian tax return. But we get a lot of people who had no choice but to get an ABN to be paid. So what happens to these earnings? Basically it needs to be included in your tax return together with any other income (such as your income from employment or interest) after the end of financial year (June). When you lodge your tax return, all your income will be added up and the tax will be assessed based on the combined income. If you are a full year tax resident and if your total income is below $18,200, you don’t need to pay any tax – meaning you get a full refund of tax you paid during the year. If you earned over the tax free threshold then you will either not get all your tax back or even have to pay more tax as a result of your Australian tax return.
Our biggest tip is to stay organized and keep:
- Invoices that you issued for your work
- Receipts for the things you had to buy for work
- Your ABN and
- The address your ABN is registered at.
If you want to know how much tax to put aside, Please contact us.
Need to sort out your tax return? Tax Purpose can assist you, please contact us.
If you have an inquiry about BAS or just anything else please contact us.
