Taxation Administration Act 1953 - Withholding Schedules 2005 (2004 Budget Changes)
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General examples
1. Payee’s weekly earnings are $758.25. Payee has completed a Tax file number declaration claiming the tax-free threshold. The payee has also furnished a Medicare levy variation declaration with 5 children shown at question 12. Scale 2 is applied.
x = 758.99
Weekly withholding amount (y)
= (a × x) – b
= (0.3150 × 758.99) – 71.1038
= 167.9781 or $168.00 (rounded to nearest dollar)
Levy adjustment: Weekly earnings are greater than WFT ($746.81) and less than the SOP ($807) appropriate to payee with 5 children. Formula (3) applies.
= (746.81 × 0.0150) – ((758.99 – 746.81) × 0.1850)
= 11.2022 – 2.2533
= 8.9489 or $9.00 (rounded to nearest dollar)
Net weekly withholding amount
$168.00 – $9.00 = $159.00
2. Payee’s fortnightly earnings are $830.40. Payee resides in Zone B, has provided a Tax file number declaration that claims the tax-free threshold and a Withholding declaration that claims FTB, zone and dependant tax offsets at the family tax benefit and tax offsets questions of $1645. The payee has also lodged a Medicare levy variation declaration claiming a FULL exemption from the Medicare levy. Scale 5 is applied.
Convert to weekly equivalent
= (830.40 ÷ 2)
= 415.20 or $415 (ignore cents) x = 415.99
Weekly withholding amount (y)
= (a × x) – b
= (0.3000 × 415.99) – 71.2050
= 53.592 or $54.00 (rounded to nearest dollar)
Fortnightly withholding amount
$54.00 × 2 = $108.00
FTB/tax offsets claimed at the FTB and tax offsets questions on the Withholding declaration
= 3.8% of $1645
= 62.5100 or $63.00 (rounded to nearest dollar)
Net fortnightly withholding amount
$108.00 – $63.00 = $45.00
3. Payee’s monthly earnings are $3033.33. Payee has provided a Tax file number declaration claiming the tax-free threshold and claimed a total dependant tax offset of $1365 at the tax offsets question on the Withholding declaration. The payee has one child but is not eligible for a Medicare levy adjustment. The weekly equivalent of the payee’s earnings exceeds the Medicare levy shading out point of $609 appropriate to a payee with one child. The payee is not eligible to receive a leave loading, therefore Scale 7 is applied.
Convert to weekly equivalent
= ($3033.33 + 0.01) × 3 ÷ 13
= 700.0015 or $700 (ignore cents)