Tax Rates For 2014-2015 Year (Residents)
The basic tax scale and marginal rates for the 2014-15 financial year have been in place for three financial years, however from 1 July 2014 the top marginal tax rate of 45% for incomes over $180,000 has the 2% Temporary Budget Repair Levy added to it (for 3 years from 1 July 2014).
Additionally in 2014-15, the basic medicare levy percentage rate has been increased by 0.5% (to 2%).
The 2014-15 financial year starts on 1 July 2014 and ends on 30 June 2015. The financial year for tax purposes for individuals starts on 1st July and ends on 30 June of the following year.
Personal Tax Rates 2014-15
** (including the Temporary Budget Repair Levy)
|Taxable income||Tax on this income*|
|0 – $18,200||Nil|
|$18,201 – $37,000||19c for each $1 over $18,200|
|$37,001 – $80,000||$3,572 plus 32.5c for each $1 over $37,000|
|$80,001 – $180,000||$17,547 plus 37c for each $1 over $80,000|
|**$180,001 and over||$54,547 plus 47c ** for each $1 over $180,000|
The above table does not include Medicare Levy or the effect of any Low Income Tax Offset (“LITO”).
Medicare Levy is applied on a progressive basis at the additional rate of 2.0% plus the Medicare Levy Surcharge if eligible private health insurance cover is not maintained. There are low income and other full or partial Medicare exemptions available.
The Low Income Tax Offset (“LITO”) full amount is $445 reducing by 1.5 cents in the dollar, for every dollar of taxable income over $37,000 such that it cuts out at $66,667. The effect is that no tax is payable up to an income of $20,542.
** Temporary Budget Repair Levy on Higher Income Earners”
The Federal Budget 2014-15 measures included a Temporary Budget Repair Levy of 2% applicable on taxable incomes in excess $180,000. This in effect increases the highest marginal tax rate in the table below from 45% to 47% (before Medicare), and takes effect for 3 years from 1 July 2014 until 30 June 2017. The relevant legislation is now law and is incorporated in the tax table above.
Higher Income Earners – potentially a 50.5% tax rate
For taxpayers with income over $180,000, the inclusion this year of the Temporary Budget Repair levy moves the the top marginal tax rate to 47%, which becomes 49% when the basic Medicare Levy is added. For those without sufficient health insurance, the maximum Medicare Levy Surcharge that could apply is 1.5% resulting in an all-up marginal rate of 50.5% on the higher income.[/su_spoiler]
Other Tax changes for 2014-15
- Increase in the basic Medicare Levy by 0.5% from 1.5% to 2% applies from 1 July 2014 in a measure associated with the funding of the National Disability Insurance Scheme.
- The increase in basic medicare levy has caused flow-on adjustments to the FBT rate, grossing-up percentages and other calculations. See Fringe Benefits Tax and see also Reportable Fringe Benefits
- The Federal Budget 2014-15 presented to parliament on 13 May 2014 contains a proposal to remove the dependent spouse tax offset (which had already been subject to phase-out measures based on date of birth) for all taxpayers with effect from 1 July 2014. (Note however that the Invalid and Carer tax offset continues to be available).
- The Mature Age Workers tax offset is not available from 1 July 2014
- Medical expenses – the tax offset is being phased out – only taxpayers with eligible claims in 2013-14 or have claims that are for disability aids, attendant care or aged care expenses can be eligible to claim in 2014-15 – see: Medical Expenses tax offset
- Electronic assessments by default – tax returns lodged electronically will not receive a paper assessment, but an automatic electronic notice of assessment and tax receipt via the myGov inbox.
- Tracking the progress of tax returns can be done via access to the Tax Office’s internet portals – see online services for individuals and sole traders here (requires sign-up to myGov) or log in to the business portal.
- Small Business and Primary Producers accelerated depreciation (from 12 May 2015):
- immediate write-off limit for each Small Business asset purchased is increased to $20,000
- farmers get accelerated deductions for water facilities (100%), fodder storage (3 years) and fencing (100%). These proposals were set forth in the 2015-16 budget announcements – see Small Business Concessions
Free annual tax calculator
For a copy of our spreadsheet tax calculator tool go here
Tax free income
For listings of common income items which are not taxable see Income on which you don’t pay tax
PAYG withholding tax calculator
For a copy of our spreadsheet tax instalments calculator – updated for the current tax year go here
Save tax on long service leave
Since 1993, long service and annual leave have been taxable at marginal tax rates. However when paid in a lump sum, and with some planning ahead, there are opportunities to achieve tax savings. See Long service and annual leave here..
This page was last modified on 5 July 2015