All the information asked for on the return must be given.
A tax return must list all income received by the taxpayer including:
- money earned while carrying on a business
- tips received in the course of employment
- amounts deducted by an employer from salary or wages (e.g. medical benefits)
- most annuities and pensions
- regular income under a will but not a specific bequest or sum of money
- workers’ compensation paid weekly or periodically but not lump sum workers’ compensation or a court award of damages for personal injury
- interest from savings banks, fixed deposits, building societies, credit unions, debentures, personal loans, interest on proceeds of a property sale, state government or Commonwealth Government loans
- interest from a bank or building society account where the person is a trustee for another person (e.g. a child)
- holiday pay, lump sum back pay and long service leave payments
- Australian income of a non-resident
- unemployment and sickness benefits, age pension, supporting parent’s benefit, widow’s pension
- invalid pension but only when the recipient is of age pension age
- repatriation service pension but only when the recipient is of age pension age. Any portion that is a disability allowance is non-taxable and a war widow’s pension is totally exempt
- retirement, termination and similar payments made as a result of the termination of employment.
The level of income tax that is payable is calculated as a percentage based upon the level of income earned by the taxpayer. This is part of what is commonly called a progressive tax system and is designed to ensure that those who earn more also pay more tax.
The current and recent tax rates can be viewed on the Australian Taxation Office website.
Likewise, there is a levy for those who do not have sufficient private health insurance and whose incomes are relatively high, at rates up to 1.5%.
Payments from superannuation funds are employment termination payments unless they are paid as a pension or annuity. Questions should be directed to a tax adviser.