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Tax File Number

What happens if I don’t have a Tax File Number

When you start work in Australia, your employer will ask you to complete an Australian Tax File Number declaration (often called a TFN declaration) quoting your tax file number or to claim an exemption from quoting a TFN. You are able to claim an exemption if you are under 18 years old or will earn less than $18,200 per financial year (1 July to 30 June). If you cannot provide it to them within 28 days of starting work in Australia then they are required to deduct income tax from your wages or salary at the maximum income tax rate, which is currently 46.5% after the 28 day period. It is therefore quite important to apply for your TFN as soon as possible!

The Tax Free Threshold

Australian tax residents (this also applies to most migrants, including most temporary residence visa holders) pay no income tax on the first $18,200 they earn, meaning if you earn less than this amount you will not pay any income tax in Australia. If you only have one employer, when you complete your tax file number declaration form, you should place an X in the Yes box for Question 8, “Do you want to claim the tax free threshold from this employer?”
If you have more than one employer, you generally claim the tax free threshold from the highest paying employer (primary income source) unless you will earn less than $18,200 from both employers, then you can claim the tax free threshold from both employers.

For more detailed information on Tax File Numbers and tax in general, please visit the Australian Taxation Office (ATO) Website.

Taxable Income (annual income) Tax on this Income
0 – $18,200 Nil Tax
$18,201 – $37,000 19cents for each $1 over $18,200
$37,001 – $80,000 $3,572 plus 32.5cents for each $1 over $37,000
$80,001 – $180,000 $17,547 plus 37cents for each $1 over $80,000
$180,001 and over $54,547 plus 45cents for each $1 over $180,000

*These rates do not include the medicare levy of 2% for taxable incomes over $180,000.

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