First Time Working - Question about Taxes

TheBardsTale on 12/02/2024 - 09:36
Last edited 12/02/2024 - 14:09 by 1 other user

This is my first time working and paying taxes.

I am a paraprofessional teacher (university student). I work 30.8 hours a fortnight week and earn $31.50 per hour.

I was reading this link from the ATO and it specifies regarding bags: If the bag or case cost you $300 or less, and you use it for work only, you can claim an immediate deduction for the whole cost of the bag in the year you buy it.

Now, that makes sense. The leather briefcase I was looking to get costs $120. What I'm confused about is how much of that money will I get back? In my last payslip it said "Marginal Tax $294.00". If I'm claiming a $120 briefcase, will I get $120 back in my tax return? Or will I get back the GST?

I'm very confused and any sort of help would be appreciated.

Financial Taxation

Comments

  • foxmulder on 12/02/2024 - 09:38
    +7

    $120 reduce your taxable income from x to x-$120.

    • TheBardsTale on 12/02/2024 - 10:12

      Thanks for the help

      • foxmulder on 12/02/2024 - 11:04
        +1

        No problem. I personally read books about tax to help in my tax affair - I recommend 101 Ways to Save Money on Your Tax Legally by Adrian Raftery. Finance book in general to manage your money - The Barefoot Investor by Scott Pape. I think books about tax should be deductible too, but the finance money probably not.

      • HeWhoKnows on 13/02/2024 - 08:14

        You are getting ahead of yourself
        Focus on the job.
        Keep all receipts for any expenses you believe might qualify as tax deductions
        Then present them to your accountant at the end of the financial year who will advise you what is tax deductable.

        As Foxmulder noted in simple terms….
        The cost of any items purchased, that qualify as a tax deduction, can claimed/used at the end of the tax year to reduce your taxable income when you lodge your tax return.

  • jv on 12/02/2024 - 09:43
    +3

    What I'm confused about is how much of that money will I get back?

    It will be deducted from your total income.

    You wont get anything back. It will just reduce the amount of tax you need to pay, so calculate it based on your top tax rate (+ medicare levy)

    • MITM on 12/02/2024 - 23:08

      OP will get a portion of the money back included in a tax refund paid directly into OPs bank account along with a portion of other work related deductibles if an employee paying PAYG. Portion or percentage is based on overall tax bracket OP occupies.

      • jv on 12/02/2024 - 23:21

        OP will get a portion of the money back included in a tax refund

        Not necessarily.

        • MITM on 12/02/2024 - 23:37

          Majority of PAYG employees are over taxed weekly, so do receive a refund. Adding deductions ensures you get a refund.

          • jv on 13/02/2024 - 00:32

            @MITM:

            Majority

            Maybe, but not everyone…

          • larndis on 13/02/2024 - 08:20

            @MITM: I don't believe this is true, if you have a steady income your PAYG withholdings should be very close to your final tax payable on income.

            If you don't have deductions you should end up with a very small refund/bill.

            If your employer is withholding an additional amount and you didn't ask them to, you should question that.

            There is definitely no blanket policy of 'overtaxing', that would be illegal.

            • MITM on 18/02/2024 - 17:09

              @larndis:

              If you don't have deductions you should end up with a very small refund/bill.

              The ATO is not going to put you in debt.
              Via PAYG the ATO will receive excess which will be refunded - that is how the PAYG table calculates the weekly tax amount shown on the payslip.

  • jv on 12/02/2024 - 09:45
    +1

    I am a paraprofessional teacher
    I'm very confused

    I hope you are not teaching maths or accounting…

    • Clear on 12/02/2024 - 09:48
      -2

      They try so hard not to make anyone fail getting their degree in Education these days. It's no wonder there's so many bad teachers.

      • jv on 12/02/2024 - 09:49

        It's no wonder there's so many bad teachers.

        😲

      • TheBardsTale on 12/02/2024 - 09:54

        Hope you're not implying I'm a bad teacher because I have never paid taxes and don't know how they work…

        Something tells me accounting teachers are going to know how to do taxes, but maths isn't really related to taxes. If you don't know how the system works, it doesn't really matter if you know how to work out 32.5c on every $1 after 50,000….

        Besides, I'm not an accounting teacher or a maths teacher.

        • Clear on 12/02/2024 - 09:59
          -1

          You replied to the wrong person ;)

          • Clear on 12/02/2024 - 14:53
            -1

            @Clear: So a few neggers think I'm wrong? Time to get fact checked that OP should have replied to jv instead of me who never said or implied anything bad towards OP.

            Notification and the comment replied to. Ouch.

        • cashless on 12/02/2024 - 14:25

          but maths isn't really related to taxes

          That is just so wrong!
          The last time I checked my kids High School maths papers there were several questions in there about personal taxation.
          How can you call yourself a teacher?

          • MITM on 12/02/2024 - 23:14

            @cashless: Not a maths or accounting teacher - so gets a hall pass doing taxes.

          • TheBardsTale on 13/02/2024 - 14:03

            @cashless: I'm not a maths teacher, mate.

        • Jono05 on 18/02/2024 - 14:26

          Can you read and use google?

    • Dollar General on 12/02/2024 - 13:00

      There are many aspects to accounting, not just tax accounting.

      • MITM on 12/02/2024 - 23:15

        Generally speaking.

  • dtc on 12/02/2024 - 09:54
    +5

    If you work for the whole year you will earn around $25,225. You will be paying 19% tax rate. The tax deduction will reduce your income by $120, meaning you will pay 120 * 19% less tax (= $22.80). That is what the tax deduction is worth.

      • zonra on 12/02/2024 - 10:08

        You don’t earn enough to be on 32.5% tax margin, according to the info you’ve given in the OP.
        So dtc’s right, you will pay $22.8 less tax by the end of the year, not $39.

        • TheBardsTale on 12/02/2024 - 10:10

          Of course, you're right. I completely misread it.

  • mskeggs on 12/02/2024 - 10:15
    +16

    Not sure why people are giving the OP a hard time. It is exceedingly common for people to think a tax deduction will refund the full cost, even among people much more experienced.

    • Clear on 12/02/2024 - 10:23
      +3

      Indeed. Most people aren't taught tax in school so you need to figure it out yourself. For me it was literally how to get a TFN and that's it.

    • freefall101 on 12/02/2024 - 11:02
      +7

      I spent many years working in tax, it's a very common belief. Up there with people who think rich people make donations to avoid tax (there are some dodgy forms of donations, but generally they are just rich people giving away money they don't need and getting back 45c on the dollar). But nowhere near the dumbest thing I've heard.

      My favourite was explaining to someone why their 5 year old wasn't eligible for tertiary education deductions. The guy was a doctor. That and someone querying why hotel porn didn't count as a travel expense, or the dude who wanted to mint his own gold coins, value them at a dollar and pay them to staff to avoid payroll tax.

      • Sammy2000 on 12/02/2024 - 22:25

        You should write a book about such nonsense.

    • brendanm on 12/02/2024 - 11:15
      +2

      One would hope a teacher could do the research to find out how it works I suppose.

      • MITM on 12/02/2024 - 23:18

        OP is a teachers aid, not a researcher.

        • brendanm on 13/02/2024 - 08:03
          +1

          Teachers aides aren't capable of reading the ATO website? Our standards have lowered quite a way.

    • redfox1200 on 12/02/2024 - 11:24
      +2

      Literally my first job at Coles, the union was signing everyone up saying its 100% tax deductible, but people still in highschool are going to assume that it means its free.

      learned pretty quickly after that how the financial system works.

      • mskeggs on 12/02/2024 - 11:56
        +2

        Yeah, that is often the language used. That the fee is wholly deductible makes it sound like you get it all back.
        And low hour casuals probably don't pay any tax to get back.

        • jv on 12/02/2024 - 13:20
          -1

          And low hour casuals probably don't pay any tax to get back.

          Just proves how dodgy unions are…

  • DashCam AKA Rolts on 12/02/2024 - 10:39

    @TheBardsTale
    Keep receipts for stationery, external drives for work - this is work related and claimable.
    Also if doing any prep or work at home = home office expenses (heating/cooling/lighting, proportional depreciation office furniture) - claimable
    Using your own laptop/device/printer/scanner etc for work = proportional depreciation - claimable

    • TheBardsTale on 12/02/2024 - 10:42

      Also if doing any prep or work at home = home office expenses (heating/cooling/lighting, proportional depreciation office furniture) - claimable
      Using your own laptop/device/printer/scanner etc for work = proportional depreciation - claimable

      Would I need receipts for my PC, office chair, printer, scanner etc, to claim the depreciation?

      Also, how should I be logging hours I do work at school to claim heating/cooling and lighting?

      • geekcohen on 12/02/2024 - 10:46
        +1

        Would I need receipts for my PC, office chair, printer, scanner etc, to claim the depreciation?

        Yes, you really should have receipts for everything in the event that you get audited. Bank Transactions can be used, but receipts are always best.

        Also, how should I be logging hours I do work at school to claim heating/cooling and lighting?

        Yes, definitely.

        • TheBardsTale on 12/02/2024 - 10:50

          Oh well, I bought my PC in 2021 anyway. I'll have email receipts somewhere I guess.

          • geekcohen on 12/02/2024 - 10:54
            +1

            @TheBardsTale: Too late (I think) you need to claim in the FY that you bought it and then claim depreciation on it each year after that.

            I think, I could be wrong.

            • dtc on 12/02/2024 - 12:28
              +1

              @geekcohen: if you buy something and then convert it to business use, you can claim depreciation from the date of conversion. You have to deduct the depreciation first and then can only claim from the depreciated value not the new value. However, as a laptop is depreciated over 2 years for tax purposes, the OPs laptop has no value to claim depreciation on

              • MITM on 12/02/2024 - 23:25
                -1

                @dtc: OP has a PC. Dep life =5yrs. (I could be wrong) but has to calculate work/private use ratio.

  • kingsville on 12/02/2024 - 14:31

    It looks like you've worked out that on your salary of just over 50K, the marginal tax rate is 32.5%.
    So claiming a deduction of $120, means that your tax payable goes down by about $39.
    This is the same as saying that if you buy the briefcase, your tax return will give you $39 back.

    BUT - if you are only starting working now, your annual salary for 2023-24 won't be the full 50K. I'm guessing 19%, so only $23 back on your awesome bag :(

  • AndyC1 on 12/02/2024 - 19:04

    Keep receipts for everything that has anything to do with work. This includes internet at home if you need it for marking exams or looking up info to teach. For internet keep a diary of how much you used it for school related activity.
    Once you claim more than a total of $300 you will need receipts including the $300.

    Google to see what you can legally claim and make sure the info is current as it changes from year to year, but not much (with the WFH allot has changed last tax year).

    Your tax rates are on the https://www.ato.gov.au/tax-rates-and-codes/tax-rates-austral… page. You will get back 19c per the dollar deducted, or 19%.

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