If you have more than one job, be careful claiming the tax free Threshold.
The Tax-Free Threshold is the amount of income that an individual can earn in a financial year before being subject to income tax.
This threshold is currently set at $18,200. This means that if you are an Australian resident for tax purposes, you will not have to pay tax on the first $18,200 of your annual income.
Tax Free Threshold and Multiple Jobs.
If you have multiple jobs, it is important to only claim the Tax-Free Threshold on one of them. This is because the amount of tax you pay is calculated using your total income in a financial year rather than what you earn at each job separately. If you claim the Tax-Free Threshold on all your jobs, not enough tax will be deducted and you may have to PAY TAX when you lodge your Tax Return at the end of the financial year.
It is important to be aware of how much you are earning and whether or not it is within the Tax-Free Threshold.
If your total income from all your payers will be $18,200 or less, you can choose to claim the Tax-Free Threshold from each payer. However, if your total income later increases to above $18,200, you'll need to provide one of your employers with a withholding declaration.
If you have multiple jobs you need to get on top of this. It is important to understand when to claim the Tax-Free Threshold and when not to in order to avoid any tax shortfalls at the end of the year. By being aware of the requirements and claiming the threshold correctly with your employer, you can ensure that you won't have a tax shortfall at the end of the year.