What Is The “Not Claiming Tax Free Threshold” Rate on a Second Job?

Hret95 on 05/07/2020 - 09:54
Last edited 05/07/2020 - 09:55

Hi all, been searching all over the internet but haven’t been able to find anything really.

Due to covid, the industry I work in had pretty much lost all work for the year and therefore my usual full time roll which would be min 38 hours a week (but more so 50hrs with great overtime) has been cut to roughly 20 hours per week which is essentially just the jobkeeper payment.

With that, I found another job, casual, with good pay and plenty of hours to offer.

I ticked the box “no” when asked if I’d like to claim the tax free threshold.

I understand that I’m taxed at the “usual rate”, but is it based on the first threshold which is 19c per $1 or is it more?

Apologies for a probably super basic question, this side of taxes isn’t my strong side.

Thanks in advance!

Edit: I should add that this is in terms of how much tax is withheld at pay time.

Financial

Comments

  • azvc on 05/07/2020 - 10:03
    +2

    The amount to be withheld depends on your earning in a particular pay period(cycle)

    There are Tax Tables that shows Amount to be Withheld

    Paid weekly

    Paid fortnightly

    Edit - Income from more than one job link for your reading pleasure

    • Hret95 on 05/07/2020 - 10:10

      Thanks for those pdfs. I think that clears it up a bit more. The second link just tells me that Tax will be withheld at a higher rate, but not what the rate is.

      I guess in the end it doesn’t really matter as It’ll get sorted at tax time.

      Appreciate it!

  • foxmulder on 05/07/2020 - 10:05
    +1

    I guess best to revise both jobs. One with higher pay you say 'no'. The one with lower pay you say 'yes'.

    • Hret95 on 05/07/2020 - 10:11

      What’s the thought behind this? It does suggest claiming the threshold for the higher paying job and not claiming it for the lesser paying.

      • lubos on 05/07/2020 - 11:17
        +3

        It doesn't really matter… tax-free treshhold is worth about $65 per week. Overall your take-home pay won't change much and at tax time it will make zero difference. Some people like to claim tax-free treshhold on the lesser paying job for the illusion of getting $65 per week extra from the 2nd job at the cost of getting $65 per week less from the first job.

        ATO couldn't care less. The reason why they recommend not to claim tax-free treshhold on your 2nd job is make it easier for your primary employer who doesn't have to fiddle with their payroll system everytime you get or lose 2nd job. Also, if you don't want your primary employer to know you have a second job, you don't want to claim tax-free threshhold on your 2nd job.

        • Hret95 on 05/07/2020 - 11:35
          +1

          That makes sense. And you’re absolutely right, at the end of the financial year, it doesn’t matter.

          Cheers!

      • argonide on 05/07/2020 - 14:17

        You would have more tax withheld if you claimed the threshold on the lower paying job.
        E.g. $750/week with threshold and $200/week without threshold, you would have $140 withheld.
        $750/week without threshold and $200/week with threshold, you would have $217 withheld.

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