Taxable income	Tax on this income
0 – $18,200	Nil
$18,201 – $37,000	19c for each $1 over $18,200
$37,001 – $87,000	$3,572 plus 32.5c for each $1 over $37,000
$87,001 – $180,000	$19,822 plus 37c for each $1 over $87,000
$180,001 and over	$54,232 plus 45c for each $1 over $180,Resident tax rates 2024–25 Taxable income Tax on this income 0 – $18,200 Nil $18,201 – $45,000 16c for each $1 over $18,200 $45,001 – $135,000 $4,288 plus 30c for each $1 over $45,000 $135,001 – $190,000 $31,288 plus 37c for each $1 over $135,000 $190,001 and over $51,638 plus 45c for each $1 over $190,000

Plus 2.0% Medicare Levy on the Taxable Income above.  There are low income, full or partial Medicare exemptions available. Medicare Levy Surcharge [ MLS ] will be applicable as applicable below.

Medicare Levy Surcharge:

The Medicare levy surcharge (MLS) is in addition to the Medicare levy.

• your taxable income
• your total reportable fringe benefits, and
• any amount on which family trust distribution tax has been paid

	Unchanged	Tier 1	Tier 2	Tier 3
Singles	90,000 or less	$90,001 – $105,000	$105,001 – $140,000	$140,001 or more
Families	$180,000 or less	$180,001 – $210,000	$210,001 – $280,000	$280,001 or more
Medicare Levy Surcharge	0%	1%	1.25%	1.5%

Previous Year Tax Rates could be looked by clicking this link

http://www.ato.gov.au/Rates/tax-rates-and-codes/previous-years-tax-tablesIndividual-income-tax-for-prior-years/

TAX RATES FOR NON RESIDENTS OF AUSTRALIA:

0 – $90,000	32.5c for each $1
$90,001 – $180,000	$29,250 plus 37c for each $1 over $90,000
$180,001 and over	$62,550 plus 45c for each $1 0 – $90,000 32.5c for each $1 $90,001 – $180,000 $29,250 plus 37c for each $1 over $90,000 $180,001 and over $62,550 plus 45c for each $1 over $180,000

ATO LIKELY TO AUDIT !!

This year we will be focused on:

• High overall expense claim
• Poor record keeping or non-compliance of records

Work from home fixed rate

The fixed rate for work from home expenses for 2024–25 is 70c per hour.

See, Fixed rate method.

Cents per kilometre increase

The cents per kilometre rate for work-related car expenses for 2024–25 is 88c per kilometre.

See, Calculating your car expense deductions and keeping records.

Electric vehicle home charging rate – plug-in hybrid electric vehicles

From 1 July 2024, if you own and use a plug-in hybrid electric vehicle (PHEV) you can use the EV home charging rate to calculate the cost of charging your PHEV at home.

To use the EV home charging rate of 4.2c per kilometre to determine the cost of your electricity, you must:

• use your PHEV for gaining or producing your assessable income
• incur electricity expenses when charging your PHEV at home
• have kept the relevant records for the income year
• be claiming your car expenses using the logbook method or claiming your actual work-related vehicle expenses.

If you choose to use this rate and your vehicle doesn’t have the ability to accurately determine the home charging percentage, you can’t claim commercial charging station costs you incurred during the income year as a separate deduction.

Alternatively, you can choose to claim the electricity used for charging your PHEV by determining the actual cost incurred. Owners of zero emissions electric vehicles (EVs) who use their vehicles for gaining or producing their assessable income can continue using the EV home charging rate provided they meet the relevant requirements.

This guidance doesn’t apply to electric motorcycles or electric scooters.

For more information, see Draft Practical Compliance Guideline PCG 2024/DC2 Electric vehicle home charging rate – calculating electricity costs when a vehicle is charged at an employee’s or individual’s home.

Lump sum payment in arrears exemption from Medicare levy

From 1 July 2024, if you meet the eligibility requirements, we will exclude the lump sum payment in arrears (LSPIA) amount when calculating your Medicare levy liability. This ensures that no Medicare levy applies to the eligible lump sum.

We will work out if you’re eligible for the Medicare levy exemption on your LSPIA using the information in your current year and prior year tax returns.

You may also be eligible for the lump sum payment in arrears tax offsets on your LSPIA amount.

For more information, see Lump sum payment in arrears.

Selling and purchasing property

From 1 January 2025 the foreign resident capital gains withholding (FRCGW) rate increased to 15% and the threshold was removed. It applies to all individual and non-individual vendors (property sellers) selling or disposing of certain taxable real property.

Australian residents selling property need a clearance certificate to avoid having an amount withheld from the sale price.

Types of property include:

• your home
• vacant land, buildings, residential and commercial property
• mining, quarrying or prospecting rights where they are situated in Australia
• a lease over real property in Australia
• indirect Australian real property (IARP) interests, where the holder has a right to occupy land or buildings on land.

The 15% withholding rate applies to the market value of all property contracts signed on or after 1 January 2025, unless the vendor (property seller):

• is an Australian resident for tax purposes and provides their clearance certificate to the purchaser
• is a foreign resident who is eligible to reduce the amount withheld by supplying the purchaser with a variation notice.

If you are an Australian resident and you didn’t obtain a clearance certificate, you can claim the amount that was withheld in your tax return. For full instructions, see:

• myTax 2025 Capital gains or losses
• 18 Capital gains 2025 (paper).

Tax Help eligibility expansion

The eligibility criteria for the Tax Help program has changed. If you earn $70,000 or less and have simple tax affairs, you can access free assistance through our program (previously the income limit was $60,000).

From July to October, ATO-trained volunteers can help you lodge your tax return online using myTax. They can also assist you with:

• non-lodgment advice
• amending a tax return if you’ve made a mistake
• lodging a refund of franking credits
• creating your myGov account, or helping you link your account to the ATO.

For more information, see Tax Help program.

Reducing the use of cheques for refunds

The Treasury Laws Amendment (2024 Tax and Other Measures No. 1) Act 2024External Link amends tax law to provide us with a discretionary power to retain certain tax refunds and credits for up to 90 days. We can retain the refund from the date the refund or credit becomes payable.

To avoid delays in receiving a refund from us, ensure you provide or update your financial institution details.

If we retain your refund because we don’t have valid Australian financial institution details, we will contact you by letter, email, or through a myGov message.

The holding rule doesn’t apply where you provide valid Australian financial institution details with your tax return.

Proposed $1,000 instant tax deduction

On 13 April 2025, as part of Labor’s election commitments, they proposed a $1,000 instant tax deduction for work-related expenses. This change applies from 2026–27. It is not yet law and does not apply to Tax Time 2025.

For information about deductions for the 2024–25 income year, see Deductions you can claim.

CONCESSIONAL CONTRIBUTION:

• employer contributions (including contributions made under a salary sacrifice arrangement)
• personal contributions claimed as a tax deduction by a self-employed person after submitting form Notice of Intent to claim a Superannuation deduction. More info herein: https://www.ato.gov.au/forms-and-instructions/superannuation-personal-contributions-notice-of-intent-to-claim-or-vary-a-deduction

Concessional contributions caps

Income year	Date	Your age at this date	Your concessional contribution cap
2025–26	n/a	All ages	$30,000
2024–25	n/a	All ages	$30,000
2023–24	n/a	All ages	$27,500
2022–23	n/a	All ages	$27,500
2021–22	n/a	All ages	$27,500
2020–21	n/a	All ages	$25,000

NON-CONCESSIONAL CONTRIBUTIONAL CAP:

Non-concessional contributions include personal contributions for which you do not claim an income tax deduction.

Income year	Amount of cap
2025–26	$120,000, see Note 1
2024–25	$120,000 see Note 1
2023–24	$110,000 see Note 1
2022–23	$110,000 see Note 1
2021–22	$110,000 see Note 1
2020–21	$100,000 see Note 1
2019–20	$100,000 see Note 1
2018–19	$100,000 see Note 1
2017–18	$100,000 see Note 1

CGT cap amount

Under the CGT cap, you can during your lifetime, exclude non-concessional super contributions from your non-concessional contributions cap up to the CGT cap amount. The CGT cap applies to all excluded CGT contributions, whether they were made between 10 May 2006 and 30 June 2007 or after 30 June 2007.

Income year	Amount of cap
2025–26	$1,865,000
2024–25	$1,780,000
2023–24	$1,705,000
2022–23	$1,650,000
2021–22	$1,615,000
2020–21	$1,565,000

Also, high income earners can get taxed under Div 293 !

Division 293 tax on concessional contributions by high-income earners

If your income and concessional super contributions total more than $250,000, check if you have to pay Division 293 tax.

About Division 293 tax

Division 293 tax is an additional tax on super contributions, reducing the tax concession for individuals whose combined income and concessional contributions for Division 293 purposes is more than $250,000.

Division 293 tax is charged at 15% of the excess over the threshold or the taxable super contributions, whichever is less.

Division 293 income

The income component of the Division 293 tax calculation is based on the same income calculation used to determine the Medicare levy surcharge (MLS), disregarding any reportable superannuation contributions.

The components of this income calculation are:

• taxable income (assessable income minus allowable deductions)
• total reportable fringe benefits amounts
• net financial investment loss
• net rental property loss
• net amount on which family trust distribution tax has been paid
• super lump sum taxed elements with a zero tax rate
• assessable first home super saver released amount.

One-off events

Even though you may not normally have an income in excess of the Division 293 threshold, certain events can increase your income to this level for a particular year.

For this reason Division 293 might apply to you for only one year where:

• you receive an eligible termination payment
• you make a capital gain
• your income increases for another reason.

How to pay

You can pay Division 293 tax liabilities either:

• with your own money – see How to pay
• by releasing money from super – see Making an election to release money from super.

If clients are claiming a work-related expense deduction, they need to satisfy the following:

• they must have spent the money
• it must be related to their job
• they must have a record to prove it.

• Claim all work related deductions to minimize your tax bill and hopefully get yourself a tax refund. Think of everything you’ve had to buy to carry out your job this financial year.
• If you work from home you can even claim part of your rent, internet connection and electricity bills. Don’t forget your charity donations!
• If you can’t find receipts, go back and see if they can give you a copy of the receipt or invoice. Bank and credit card statements showing details of purchases can also be used.  (Source: www.ato.gov.au)

popular myth is that you taxpayers can claim $300 in all labels of the tax return. CLARIFICATION: No, a maximum of $300 worth deductions can be claimed without substantiation

You can claim

Other work-related expenses include:

• Union fees and subscriptions to trade, business or professional associations
• overtime meal expenses, if you received an overtime meal allowance from your employer that was paid under an industrial law, award or agreement, and you
  • bought and consumed the meal during your overtime
  • included the amount of the meal allowance as allowance income at Salary, wages, allowances, tips, bonuses
  • kept written evidence, such as receipts, if your claim was more than $37.65 per meal.
• reference books, technical journals and trade magazines
• the work-related portion of tools and equipment, such as a computer or office furniture and professional libraries; you may be able to claim
  • an immediate deduction for the cost of depreciating assets costing $300 or less
  • a deduction for the decline in value of an item that cost more than $300 over its effective life (however, if you no longer own or use an item and you previously claimed a deduction for its decline in value, you may need to make a balancing adjustment – see Guide to depreciating assets).
• the work-related portion of items that protect you from the risk of injury or illness posed by your work or your work environment, such as
  • hard hats, safety glasses, sunscreens and other protective items
  • but not protective clothing and footwear, which you claim at Work-related clothing, laundry and dry-cleaning expenses 
• the work-related portion of the following costs
  • interest on money you borrowed to buy tools and equipment
  • repair costs for the tools and equipment
  • phone or internet usage (if you haven’t already claimed working from home expenses using the fixed rate method)
  • phone rental, if you can show you were on call or needed to regularly phone your employer or clients while away from your workplace
  • additional running expenses you incurred because you worked from home
  • COVID-19 test expenses

Last day of filing your tax return is 31st every October or 15th May (through Reg. Tax Agents) following the closure of that financial year on June 30th. You may receive a fine or interest penalty charge from the ATO if you lodge your return beyond this date, in particular wherein a taxpayer owes money to the ATO.

Penalties and interest charges imposed by the ATO are based upon historical lodgement compliance.

• A Tax File Number (TFN) is required in order to work and be properly recognised for tax purposes in Australia.
• For tax returns, you should bring with you any PAYG Payment Summaries you have received from employers, dividend statements, bank interest records, income distribution statements, etc. Any receipts, log book, diary records, to substantiate your claims for deductions.
• If your employer has NOT finalized the last payslip of a financial year, kindly send / bring along the last payslip reflecting the pay for the financial year.  Also, kindly have access to your bank accounts so, we can verify that the information on the payslip matches with that of the bank statement.  On the contrary, please inform your employer to finalize the payslip with the ATO for the financial year.  Last option will be to make a statutory declaration with the accountant or take relevant advise.
• Include all your payment summaries, even if you’ve only worked in a job for a couple of weeks.
• Include all dividends and any other interest earned on bank accounts as income.
• Income from Centrelink (Newstart, Austudy, Youth Allowance) must be declared.
• The money you bring with you from another country prior to permanently residing in Australia is not taxable. However, the money earned in Australia is taxable.
• All Australian residents for tax purposes are required to declare their worldwide income accruing from interest dividends, rental income in their Australian tax return.  The tax paid on such overseas income to the Overseas Authorities will be offset against the Foreign Income to be reported in the Australian Tax Return provided Australia has a Double Tax Treaty with the relevant Country.

For all sources of income to be reported on your tax return.  Kindly refer to the link herein https://www.ato.gov.au/api/public/content/0-902d3332-9e81-4498-acd1-6cea96aa9720

 

A work related deduction is available for the following, provided you have receipts/documentations to substantiate the expenditure.

A deduction is allowable if the client can show that an expense was:

• Actually incurred
• Meets the deductibility tests, and
• Satisfies the substantiation rules.

• Outdoor workers who buy sunscreen lotion, sunglasses and hats for use at work
• Scientific books, trade books, or journals necessary to fulfil your job function or related books to your work.
• Travel expenses/cost of transport which is incidental to your job (mere travel between home and office will not be allowed). Travel from office to meet clients and/or authorized and travel that is described in your work duties can be claimable, provided necessary documentation is available.
• If home is a place of business, deductions can be claimed on rent, house insurance, electricity, maintenance, pest control, depreciation, repairs, decoration, cleaning, internet & telephone on a prorate basis with respect to your business usage.
• Expenses towards mobile phones and telephone used for making business calls, provided you keep receipts
• Uniforms in the course of employment and if the work uniform is specific and identifiable to your organisation (such as chef’s checked pants) or protects you from injury, whilst you are at work and can even claim the maintenance costs such as laundry & dry cleaning.
• Fees paid to a registered tax agent for preparation of your return from the previous year, amendments and all your tax matters are all deductible.
• Donations to registered charities.

• Maintain a log book recording the petrol expenses
• Receipts for expenses such as services, repairs, tyres maintenance etc.,
• Home to work and return travel is generally not claimable except in certain circumstances. Travel between jobs on the same day and travel for work (i.e. visiting clients, doing pick-ups or deliveries) would be claimable. While using public transport, keep all receipts and/or diary records/log book. If you use your own car then you need to keep a record of all business mileage travel. You should also record expenses of the car including petrol, repairs, registration, insurance and interest on a car loan.
• Credit card slip /Bpay/ email receipts having information like date, supplier, nature of the goods and the amount is accepted as a receipt.
• Documentary evidence should be kept for five years from the date of lodgement of the tax return in which the claims are made.
• Maintain records/receipts with regard to the expenses incurred in replacing, insuring and repairing tools and equipment of trade that are used as your main income for claiming expenditure
• Only study directly related to your current job may be claimed as a self-education expense. (however, an education expense that gets you a New Role / Job is cannot be treated as Self Education Expense).

What is capital gains tax?

How capital gains tax (CGT) works, and how you report and pay tax on capital gains when you sell assets.

Last updated 23 June 2025

Capital gains tax (CGT) is the tax you pay on profits from disposing of assets including investments, such as property, shares and crypto assets. Although it is referred to as ‘capital gains tax’, it’s part of your income tax. It’s not a separate tax.

If you dispose of assets (generally when you stop being the owner of an asset) a CGT event may be triggered. This is when you need to report capital gains and capital losses in your tax return.

If you have a:

• capital gain, it will increase the tax you need to pay – you may want to work out how much tax you’ll owe and set aside funds to cover it
• capital loss, you can offset it against any capital gains in the year they occur, or in future years, and reduce the tax you need to pay – it’s important to include losses in your tax return.

Carefully choose to be a “Share Trader” or to be a “Investor”. Investment is categorized as Capital in nature and the taxabe point applies. “Trader” will be treated as a business-like venture and any losses from such business transactions could offset your PAYG Income.

How the CGT discount works

When you sell or otherwise dispose of an asset, you can reduce your capital gain by 50%, if both of the following apply:

• you owned the asset for at least 12 months
• you are an Australian resident for tax purposes.

This is called the capital gains tax (CGT) discount.

12-month ownership requirement

For an asset to qualify for the CGT discount you must own it for at least 12 months before the ‘CGT event’ happens. The CGT event is the point at which you make a capital gain or loss. You exclude the day of acquisition and the day of the CGT event when working out if you owned the CGT asset for at least 12 months before the ‘CGT event’ happens. 

• If you sell the asset and there is no contract of sale, the CGT event happens at the time of sale.
• If there is a contract to sell the asset, the CGT event happens on the date of the contract, not when you settle. Property sales usually work this way.
• If the asset is lost or destroyed, the CGT event happens when:
  • you first receive an insurance payment or other compensation
  • if there is no insurance payment or compensation, when the loss occurred or was discovered.

Trusts and companies

If an asset is owned for at least 12 months:

• Australian trusts can discount a capital gain by 50%
• complying super funds can discount a capital gain by 33.33%.

Companies cannot use the CGT discount.

How to use the CGT discount

Calculating your CGT explains how to use the CGT discount to reduce your tax. Briefly, this is how it works:

1. If you have any capital losses from other assets, you must subtract these from your capital gains before applying the discount.
2. If you are entitled to the discount for an asset, you reduce the remaining capital gain on that asset by 50% and report this amount in your income tax return.
3. Complying super funds / SMSF’s reduce their capital gain by 33.33%.