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Tax for Australians for Dummies, 2014 - 15 Edition by Jimmy B. Prince

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Chapter 2

Taxing Australians: The Formula You Need to Know

In This Chapter

arrow Understanding the tax formula

arrow Identifying assessable income

arrow Working out exempt income

arrow Dissecting the general deduction provisions

arrow Including possible tax offsets

I ncome tax law is like a doing a jigsaw puzzle: You need to figure out where all the bits and pieces fit together. The Australian tax system uses a tax formula to work out whether you’re liable to pay tax or get a tax refund. The tricky part is coming to terms with all the rules and regulations that you need to obey.

In this chapter, I guide you through the key components that make up the tax formula and explain the statutory regulations you need to follow.

Doing Your Sums

Tax is levied on taxable income. At the end of each financial year (which commences on 1 July and ends on 30 June), Australian residents are required to disclose the taxable income they derive from all sources in and out of Australia. (Non-residents are required to disclose only ...

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