Welcome to www.123books.com.au I’m going to show you the fastest and easiest way to use the ATO Tax tables in under 3 minutes. Now this doesn’t cover every situation but in the majority of cases it does. So you’re already on our website at 123books.com.au then we go to the info centre then we choose the tax tables.
There are four to choose from so just scroll down and you’ll see the four. There’s a weekly, casual workers, fortnightly and monthly. So you choose the relevant tax table, I’ve already done this. In this example I’ll be giving you later we’ll be using the weekly tax tables. I’ve just downloaded it so this is what it looks like. Also remember if an employee has not supplied a valid tax file number and declaration form, employers must withhold 46.5% in most cases. If the employee is a foreign resident for tax purposes or ceases work this will not be covered here. I’ll be giving you an example in just a moment but first let’s establish what the four columns are for.
The first column is the amount earned in the pay week – Weekly Earnings. Columns 2 to 4 is the amount of taxes to be withheld depending on the situation and the terms of employment. So then we’ll need to establish what the employees total weekly earnings are in column 1 then use the appropriate column, either 2, 3 or 4 to withhold the tax.
So here’s an example. Let’s assume Michael works for 38 hours at a rate of $18 per hour. So it’s 38 x $18 per hour, that gives us a total of $684 gross for the week. So we type in there 684 for find and there it comes down in column 1 and you’ll see 684. Michael has filled out a tax file number declaration and he has a valid tax file number and he is claiming the tax free threshold. So here is tax free threshold and leave loading, he’s entitled to 4 weeks holiday per year so the amount of tax being withheld is $89. So that’s $684 – $89 = a total of $595 to be paid into Michael’s account or by cheque.
That concludes this example. If you have any queries please give us a call we’d be only too happy to talk. Bye for now.