Basic Taxation Knowledge You Need To Know

Foreign/non-residents are taxed in Australia on Australian-source income.

A foreign-resident entity that receives Australian-source income must lodge an Australian tax return and pay tax. However, you do not need to lodge a tax return if the income was interest, unfranked dividends or royalties from which withholding tax has been withheld by the payer.

Tax is withheld by the payer at the following rates:

 

Treaty countries

Non-treaty countries

Interest

Some agreements provide an exemption from withholding tax in certain circumstances.

      10%

Unfranked dividends

Most agreements reduce the rate to 15%.

       30%

Royalties

Most agreements reduce the rate to 15%.

       30%

 

For investor, you also need to understand the Capital gains tax (CGT) which is the tax you pay on any capital gain you include on your annual income tax return. It is not a separate tax, merely a component of your income tax. You are taxed on your net capital gain at your marginal tax rate.

Your net capital gain is:

your total capital gains for the year

minus

your total capital losses for the year and any unapplied net capital losses from earlier years

minus

any CGT discount and small business CGT concessions to which you are entitled.

 

 INDIVIDUAL INCOME TAX RATES  RESIDENTS

These rates apply to individuals who:

  • are residents of Australia for tax purposes for the whole financial year, and
  • did not leave full-time education for the first time during the financial year.

 

Residents

These rates apply to individuals who are Australian residents for tax purposes

Tax rates 2013-14

The following rates for 2013-14 apply from 1 July 2013.

Taxable income

Tax on this income

0 – $18,200

Nil

$18,201 – $37,000

19c for each $1 over $18,200

$37,001 – $80,000

$3,572 plus 32.5c for each $1 over $37,000

$80,001 – $180,000

$17,547 plus 37c for each $1 over $80,000

$180,001 and over

$54,547 plus 45c for each $1 over $180,000

The above rates do not include the Medicare levy of 1.5%

Tax rates 2012-13

The following rates for 2012-13 apply from 1 July 2012.

Taxable income

Tax on this income

0 – $18,200

Nil

$18,201 – $37,000

19c for each $1 over $18,200

$37,001 – $80,000

$3,572 plus 32.5c for each $1 over $37,000

$80,001 – $180,000

$17,547 plus 37c for each $1 over $80,000

$180,001 and over

$54,547 plus 45c for each $1 over $180,000

The above rates do not include the Medicare levy of 1.5%.

 

Foreign residents

If you are a foreign resident for the full year, the following rates apply:

Tax rates 2013–14

The following rates for 2013–14 apply from 1 July 2013.

Taxable income

Tax on this income

0 – $80,000

32.5c for each $1

$80,001 – $180,000

$26,000 plus 37c for each $1 over $80,000

$180,001 and over

$63,000 plus 45c for each $1 over $180,000

Foreign residents are not required to pay the Medicare levy.

 

Tax rates 2012–13

The following rates for 2012–13 apply from 1 July 2012.

Taxable income

Tax on this income

0 – $80,000

32.5c for each $1

$80,001 – $180,000

$26,000 plus 37c for each $1 over $80,000

$180,001 and over

$63,000 plus 45c for each $1 over $180,000

Foreign residents are not required to pay the Medicare levy.