Tax File Number Declarations
When an employee begins work for an employer,
both the employee and employer must complete a tax file number
declaration form. This form is used to determine the amount of tax
that must be withheld from the following information:
The employee's tax file number. It is not compulsory to provide
a tax file number however if it is not provided, the employer must withhold
tax at the top marginal rate (45% plus 1.5% medicare levy for Australian residents).
Whether the employee is an Australian resident for taxation purposes or a foreign resident. Just
because you are living overseas for an extended period does not necessarily exclude you from being an Australian
resident for taxation purposes. Sometimes residency for taxation purposes can be difficult to determine.
Contact the Australian Taxation Office if you are unsure.
A foreign resident is subject to a different tax scale and are not subject to the medicare levy.
Whether the employee is claiming the tax free threshold. This means that the first $6,000
earned in a financial year is tax free for most Australians. All amounts in excess of this are taxed.
The tax free threshold can only be claimed if a tax file number is provided and the employee is an Australian
resident. This tax free amount can only be
claimed once at any one time, meaning that it cannot be claimed again on a second job.
Whether the employee has a current outstanding student load debt such as HELP/HECS or SFSS.
If there is a debt outstanding, then additional tax amounts will be deducted to repay the debt.
Whether you wish to claim certain tax offsets (reduction in tax due to certain circumstances) such as a Medicare Levy Adjustment.
Only Australian residents can claim tax offsets.
A tax file number declaration must be completed and sent to the Australian Taxation Office within 14 days.
The form can only be ordered through the Tax Office (do not use a downloaded PDF version).
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Sunday, 5th Feb 2012
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