✔ Complete income tax calculations and salary example for $ 40,000.00 salary per annum
This income tax calculation for an individual earning $ 40,000.00 per annum is provided to allow you to compare salaries and understand the tax and payroll deductions that are applied during the 2018/19 tax year.
The $ 40,000.00 salary income tax calculation uses default setting to illustrate Medicare, Superannuation and income tax deductions. You can also produce your own bespoke income tax calculation by entering your own income and expenditure for 2018/19 in the Australia Income Tax Calculator.
This salary and tax examples provides an overview of salary deductions followed by the details of the calculations and explanation of how income tax is calculated and deducted from your salary. Our aim is to make the tax calculation transparent so you can clearly understand how your tax, salary deductions and contributions are calculated.
|$4,142.00||10.36%||Income Tax Due|
|$400.00||1.00%||Low Income Tax Offset|
1 Percentage expressed in relation to Gross Income [$40,000.00].
Income Tax is calculation based on the amount you earn. Income tax is calculated on a threshold basis with different rates applied depending on your income. The table below illustrates an income tax calculation for a $ 40,000.00 per annum salary.
|$40,000.00||Taxable Income in 2018|
|-||$0.00||Taxable amount due in within $0.00 - $18,200.00 income tax threshold (0%)|
|-||$4,142.00||Taxable amount due in within $18,200.00 - $37,000.00 income tax threshold (19%)|
|=||$4,142.00||Income tax due in 2018|
The example below shows how medicare deductions are calculated in 2018/19 tax year for an annual salary of $ 40,000.00.
|$40,000.00||Taxable income in 2018/19|
|x||2%||Medicare rate in 2018/19|
|=||$800.00||Medicare due in 2018/19|
Low Income tax credits are calculated based ona threshold approach with the non-refundable tax credit phasing out as you earn more income.
|$40,000.00||Annual Salary in 2018|
|-||$37,000.00||Low Income Threshold in 2018|
|=||$40,000.00||Combined Income tax and Medicare due in 2018|
|x||1.5%||Low Income Reduction Rate in 2018|
|=||$45.00||Low income deductible amount in 2018|
|$445.00||Annual Salary in 2018|
|-||$45.00||Low income deductible amount in 2018|
|=||$400.00||Low income deductible amount in 2018 (minimum $0.00)|
Disclaimer: whilst we aim for 100% accuracy in our payroll, tax and salary calculations we make no guarantee as to the accuracy of the information herein. This tool is provided free of charge to support those who are looking at alternate salaries or to improve the knowledge and understanding of income tax in Australia, it is not a 100% accurate tax return or tax refund calculation. If however you do spot a mistake in our calculations, the rates or thresholds used, please get in touch. Whilst we make no guarantees on the accuracy on the tax calculations, we do aim to be 100% accurate. This position allows us to support our community without any unnecessary grumpiness or actions from legal folk.