Hi people. Well i applied for the variation to tax withheld a while ago and just recieved the confirmation letter.Two things they say confuse me.
1# They say " We have varied the withholding rate to be applied to the gross payments listed below to 15% per payment
GROSS PAYMENTS Salery and wages2#We have calculated your varied withholding rate on your estimated taxible income of $54,690
Now i have a question. Is the 15% worked out on my pre tax pay packet or the lower pay figure of $54,690( That figure is my current pre tax figure minus tax losses.)
I assume its withdrawn from my weekly pre tax pay packet. If so that means i get a extra $200 per week in my pay packet. That sounds like a lot. Have i worked it out right.
I guess i should wait till pay week and see what extra is in there.Hope its right dont want to get slugged a big tax bill if its wrong.
Does any one know how it works.Hi Devo,
Yes you are correct – based on the information you have given them, they have worked out that you only need to pay %15 tax after your expenses are taken in to consideration. Therefore – the current gross income (pre tax) you receive every week will have %15 tax taken out of it instead of what you were previously paying (maybe around %25??)
The tax dept will send a letter to your employer and once they receive it, they will alter your tax rate.
Good on you for doing it yourself – an accountant will charge about $250 to do one of these forms for you. I have always done my own variation forms and not had a problem.
BUT hopefully you have stated your figures correctly! I always under estimate my expenses slightly. Remember to make adjustments if needed during the year.
Q: What will you do with the extra $200?? A: INVEST IT
cheers
TracyHi tracdy.
Yes i will kind of invest it . It will be used for extra payments of my PPOR.
The thing is i recieved a $10,000 per year payrise just after setting it up. By my calculations the difference should only be $1,500 extra tax to be paid per year.
My taxible income will rise from the $54,690 to$64,690 . I will owe the 30% of that but currently only paying the 15%..So should allow for extra $1,500 per year or change details. Think thats right. Cheers.
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