Australia’s tax system covers a wide range of areas. This is how all taxation systems are. With that said, some of the areas the tax system handles range from import tax to income tax, but residents of Australia are usually more concerned with income tax. Read on to learn more about income tax in Australia.
1. History Of Income Tax- Australia first implemented income tax in 1880, which is when Tasmania decided to tax all income that companies generated in Tasmania. Other states in Australia took notice and they saw how important it was to tax income. As a result, the southern states in the country started to implement income tax and by 1907, the entire country implemented income tax.
2. Income tax Today- Personal earnings, capital gains tax and business income are the three areas that income tax in Australia can be broken into, and personal tax varies on how much a person earns. For example, the less money a person earns, the less they will pay in income tax, and this tax is based on the income a person gets, so it is considered to be a progressive tax. Income tax is paid on six thousand dollars or more in earnings, and people who earn more pay more income tax.
Thirty percent is what the company tax is, and that is the flat rate. However, companies can do various things to reduce the amount of tax they pay. Some of these means include an annual dividend to shareholders of the company.
Capital gains tax can affect a person and a corporation, if they own an asset. The tax can also affect those who own anything in a sense. However, the percent that is paid does differ.
Australia does offer people a fair income tax system. The system is relatively easy to understand, which means all residents should have a good idea of what their tax status is. It also means they will have a good idea of what they are required to pay, and this is why many considers the country’s tax system to be one of the most simplest ones in the world.
For more tax advice or information about tax in Australia, contact ATMS, Brisbane Tax Agents.