# Silly income tax question...

Discussion in 'Accounting, Tax & Legal' started by Starkers, 18th Feb, 2008.

1. ### StarkersMember

Joined:
23rd May, 2007
Posts:
8
Location:
Sydney
This may be a dumb question, nonetheless...

If my annual income including super is say \$150000, and I want to calculate the amount of income tax payable annually on that \$150k (for simplicities sake let's assume no other income and exclude medicare levy surcharge, etc) - is my assessable income for tax purposes considered to be \$150k, or is it \$150 - super @ 9% = \$136.5k? I.e. if using the calculator in the link below, would I enter \$150k as annual income or \$136.5k?

Income Tax Calculator - Yahoo!7 Money Matters

2. ### baileyMember

Joined:
25th Jan, 2008
Posts:
14
Location:
Central Qld
Your assessable income is without super.

I don't think you calculate it by going \$150,000 x 9%. As 9% = \$13,500 and income = \$136,500.. Which actually means your employer is paying your super @ 9.9% not 9%.

You should be calculating "income + 9% = \$150,000".
\$137,600 + 9% (\$12,384) = \$150,000 (actually \$149,984 but you get the picture)..

Hope that helps...

3. ### StarkersMember

Joined:
23rd May, 2007
Posts:
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Location:
Sydney
Yes - that makes sense - thanks! So just confirming that my assessable income for tax purposes would therefore be \$137,600 (not \$150k)? Basically just trying to work out what monthly take home would be after tax, super, etc.

4. ### baileyMember

Joined:
25th Jan, 2008
Posts:
14
Location:
Central Qld
Spot on

5. ### Rob G.Well-Known Member

Joined:
6th Jun, 2007
Posts:
717
Location:
Melbourne, VIC
I assume you are an employee since you mention 9%.

Has your employer told you that your "salary package" is \$150k INCLUDING the 9% SGC ?

Or is your reported salary \$150k, and your employer looks after the super ?

It makes a difference, as your assessable income is you basic salary and does not include your employer's SGC contribution.

Cheers,

Rob

6. ### tonyusedActive Member

Joined:
9th Jan, 2008
Posts:
32
Location:
Perth, Western Australia
Assessable income is the income YOU get taxed on, ie - it's assessed for tax to you.

You can get benefits before tax - like super, fringe benefits - this is not assessable to you but to the employer, unless it's exempt.

7. ### AsxBrokerWell-Known Member

Joined:
8th Sep, 2007
Posts:
1,448
Location:
Sydney, NSW
Hi Starkers,

The maximum SG required by your employer is \$36,470 per quarter or \$145,880 pa x 9% = \$13,129.20.

If your employer has said your "package" is \$150,000 they usually include super, you can \$150,000 / 1.09 = \$137,614.68 base salary plus \$12,385.32 as your SGC.

The SGC and salary sacrifice contributions aren't taxed in your hands as they are taxed at 15% going into your superannuation account.

So you'd punch in the \$137,614 plus any other income or capital gains you receive in the year into the calculator.

Cheers,

Dan

PS Before making a taxation decision speak to your accountant or tax adviser.

8. ### StarkersMember

Joined:
23rd May, 2007
Posts:
8
Location:
Sydney
Thank you all for your comments - I now have a very clear understanding of this.