In this article, We have discussed about the details of Australia Tax Bracket 2024-2025: Lightest and Lowest tax in Australia. Australians file income tax each financial year. The Australian Tax Office collects income tax from working citizens. In this article, we will discuss the details of Australia Tax Bracket 2024-2025: Lightest and Lowest tax in Australia.
Australia Tax Bracket 2024-2025
Australian Tax Bracket gives an idea of the total earnings of the citizens considering marginal taxes. Such a process is an initiative of The Federal Government of Australia. Each individual or corporation has to follow as per specific rules and regulations. In Australia, 1 July to 30 June is considered as the financial year. And currently, Australia is in the 2024-24 financial year. The state Government didn’t have the right to impose income tax in Australia.
Within the Australian Taxation System, income tax is the most essential source of income for the Government. South Australia imposed the first income tax in Australia in 1884 with a general tax on income.
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Income Tax Rates 2024-24
The personal income of an Australian is dependent on the working factor that he/she possesses. Thus, the Government take a specific percentage of it, calling it the tax. It is mandatory for all citizens to pay taxes if they are eligible. Below in the table, we have mentioned the income tax rates for 2024-24.
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Taxable income |
Rate |
Tax on this income |
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180,001 AUD and over |
45% |
$51,667 + 45 Cent for each $1 over $180,000 |
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120,001 AUD to 180,000 AUD |
37% |
$29,467 + 37 Cent for each $1 over $120,000 |
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45,001 AUD to 120,000 AUD |
32.5% |
$5,092 + 32.5 Cent for each $1 over $45,000 |
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18,201 AUD to 45,000 AUD |
19% |
19c for each $1 over $18,200 |
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0 AUD to 18,200 AUD |
0% |
Nil |
Although this amount is not fixed, some factors are considered in its modification.
Hightest and Lowest Tax in Australia
The taxes are imposed as per the goods and service tax for each product and service in the country. According to this, the overall economic value is judged.
For income over AUD 180,000, 19% is the lowest rate of income tax, and 45% is the highest. Generally, the majority of working Australians fall in the middle bracket (tax slab). However, the details can further be checked from the main portal.
History of Australian Tax
In 1884, South Australia imposed the first income tax in Australia, with a general tax on income. In the First World War of 1915, to help in the funding of Australia, Federal Income Tax was first introduced.
In between 1915 and 1942, the federal govt. and the state govt. imposed the income taxes in Australia. In 1951, for incomes above £10,000, the highest tax rate was 75 per cent. And from 1955 to the mid-1980s, the top rate tax was 67 per cent.
How Is Tax Calculated in Australia?
For any government, the most essential source of income is income text. There are three main pillars in the Australian Taxation System.
- Capital gains
- Personal earnings
- Business earnings
If your yearly income exceeds a threshold limit, then you need to pay income tax in Australia. The annual income will include your profits from the business, your salary, and your investment returns. While selling your shares or house, then you should also pay income tax.
If your income is higher, then you need to pay more tax because Australia has a progressive taxation system. If your income is less than 18,200 AUD, then you don’t need to pay tax in Australia.
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How to save Tax in Australia?
No doubt, there are ‘n’ number of ways in which you can save your hard earned money.
- Consider Health Insurance from Private Companies.
- Claim all your deductions.
- Keep your financial and tax records accurate.
- Through a Mortgage Offset Account, you can minimize your taxes.
- You can invest in long-duration instruments to buy businesses, shares, and residential property by taking money on credit.
- To save tax, you don’t need to include non-taxable income.
These strategies will help you to plan and save your taxes in Australia. Basically, the savings are dependent on claims that you receive from a tax credit and how well you manage that particular amount.