For payments made from 1 July 2018 to 30 June 2019
This document is a withholding schedule made by the Commissioner of Taxation in accordance with sections 15-25 and 15-30 of Schedule 1 to the Taxation Administration Act 1953 (TAA). It applies to withholding payments covered by Subdivisions 12-B (except sections 12-50 and 12-55), 12-C (except sections 12-85 and 12-90) and 12-D of Schedule 1 to the TAA.
You should use this schedule if you develop your own payroll software package. Formulas and coefficients are used for calculating weekly withholding amounts for employees who have a:
Calculating fortnightly, monthly or quarterly withholding amounts
First calculate the weekly equivalent of fortnightly, monthly or quarterly earnings. If you pay:
■ fortnightly – divide the sum of the fortnightly earnings and the amount of any allowances subject to withholding by two. Ignore any cents in the result and then add 99 cents
■ monthly – obtain the sum of the monthly earnings and the amount of any allowances subject to withholding (if the result is an amount ending in 33 cents, add one cent). Multiply this amount by three and then divide by 13. Ignore any cents in the result and then add 99 cents
■ quarterly – divide the sum of the quarterly earnings and the amount of any allowances subject to withholding by 13. Ignore any cents in the result and then add 99 cents.
Then calculate fortnightly, monthly or quarterly withholding amounts as follows:
■ fortnightly – determine the rounded weekly withholding amount applicable to the weekly equivalent of earnings before any adjustment for tax offsets. Multiply this amount by two
■ monthly – determine the rounded weekly withholding amount applicable to the weekly equivalent of earnings before any adjustment for tax offsets. Multiply this amount by 13, divide the product by three and round the result to the nearest dollar
■ quarterly – determine the rounded weekly withholding amount applicable to the weekly equivalent of earnings before any adjustment for tax offsets. Multiply this amount by 13.
■ answered yes to the question ‘Do you have a Higher Education Loan Program (HELP), Student Start-up Loan (SSL) or Trade Support Loan (TSL) debt?’
■ not completed a Medicare levy variation declaration claiming a reduction or exemption in the Medicare levy for having a spouse or dependants and low family income
■ claimed the tax-free threshold or is a foreign resident with earnings of one of the following:
– $999 or more if paid weekly
– $1,998 or more if paid fortnightly
– $4,329 or more if paid monthly
– $12,987 or more if paid quarterly.
If your employee has not claimed the tax-free threshold, the HELP/SSL/TSL component is calculated on earnings of:
■ $649 or more if paid weekly
■ $1,298 or more if paid fortnightly
■ $2,812.33 or more if paid monthly
■ $8,437 or more if paid quarterly.
You must withhold the HELP/SSL/TSL component from all your employee's earnings, including taxable allowances, bonuses and commissions.
Examples:Employee has claimed the tax-free threshold and has weekly earnings of $1,095.84.HELP/SSL/TSL component = $1,095.99 × 2% = $22.00 rounded to the nearest dollar.Employee has claimed the tax-free threshold and has fortnightly earnings of $2,355.78.Weekly equivalent of $2,355.78 = $1,177.99 ($2,355.78 divided by two, ignoring cents and adding 99 cents).Weekly HELP/SSL/TSL component = $1,177.99 × 4% = $47.00 rounded to the nearest dollar.Fortnightly HELP/SSL/TSL component = $94.00 ($47.00 × 2).Employee has claimed the tax-free threshold and has monthly earnings of $5,488.45.Weekly equivalent of $5,488.45 = $1,266.99($5,488.45 × 3/13, ignoring cents and adding 99 cents).Weekly HELP/SSL/TSL component = $1,266.99 × 4.5% = $57.00 rounded to the nearest dollar.Monthly HELP/SSL/TSL component = $247.00 ($57.00 × 13/3, rounded to the nearest dollar).
■ answered yes to the question ‘Do you have a Financial Supplement debt?’
■ not completed a Medicare levy variation declaration claiming a reduction or exemption in the Medicare levy for having a spouse or dependants and low family income
■ claimed the tax-free threshold or is a foreign resident with earnings of one of the following:
– $999 or more if paid weekly
– $1,998 or more if paid fortnightly
– $4,329 or more if paid monthly
– $12,987 or more if paid quarterly.
If your employee has not claimed the tax-free threshold, the SFSS component is calculated on earnings of:
■ $649 or more if paid weekly
■ $1,298 or more if paid fortnightly
■ $2,812.33 or more if paid monthly
■ $8,437 or more if paid quarterly.
You must withhold the SFSS component from all your employee's earnings, including taxable allowances, bonuses and commissions.
Examples:Employee has claimed the tax-free threshold and has weekly earnings of $1,238.24.SFSS component = $1,238.99 × 3% = $37.00 rounded to the nearest dollar.2. Employee has claimed the tax-free threshold and has fortnightly earnings of $2,311.59.Weekly equivalent of $2,311.59 = $1,155.99 ($2,311.59 divided by two, ignoring cents and adding 99 cents).Weekly SFSS component = $1,155.99 × 2% = $23.00 rounded to the nearest dollar.Fortnightly SFSS component = $46.00 ($23.00 × 2).3. Employee has claimed the tax-free threshold and has monthly earnings of $5,689.21.Weekly equivalent of $5,689.21 = $1,312.99($5,689.21 × 3/13, ignoring cents and adding 99 cents).Weekly SFSS component = $1,312.99 × 3% = $39.00 rounded to the nearest dollar.Monthly SFSS component = $169.00 ($39.00 × 13/3, rounded to the nearest dollar).
Do not withhold any amount for HELP/SSL/TSL or Financial Supplement debts from lump sum termination payments.
Withholding amounts calculated as a result of applying the above formulas are rounded to the nearest dollar. Values ending in 50 cents are rounded to the next higher dollar. Do this rounding directly – that is, do not make a preliminary rounding to the nearest cent.
Software written in accordance with the formulas in this schedule should be tested for accuracy against the sample data provided at tax tables. The results obtained when using the coefficients in this schedule may differ slightly from the sums of the amounts shown in the PAYG tax tables. The differences result from the rounding of components.
Coefficients to work out the weekly amounts to withhold including the HELP/SSL/TSL component
Your employee’s total withholding, including the HELP/SSL/TSL component, can be calculated using the formula and coefficients stated below.
■ a and b are the values of the coefficients for each set of formulas for each range of weekly earnings (or, in the case of fortnightly, monthly or quarterly earnings, the weekly equivalent of these amounts).
If two employees are taxed using a particular scale (for example, scale 2) but only one of them has a HELP/SSL/TSL debt, you will need to set up two separate scales in your payroll system. One scale will need to incorporate the HELP/SSL/TSL component and one will not – for example, name one ‘scale 2’ and the other ‘scale 22’.
The HELP/SSL/TSL component does not apply if the employee has not provided a tax file number (TFN).
Withholding amounts including the HELP/SSL/TSL component worked out using the coefficients may differ slightly from the sums of the amounts shown in the PAYG and HELP/SSL/TSL tax tables. The differences result from the rounding of components.
Coefficients to work out the weekly amounts to withhold including the SFSS component
Your employee’s total withholding, including the SFSS component, can be calculated using the formula and coefficients stated below.
■ a and b are the values of the coefficients for each set of formulas for each range of weekly earnings (or, in the case of fortnightly, monthly or quarterly earnings, the weekly equivalent of these amounts).
If two employees are taxed using a particular scale (for example, scale 2) but only one of them has a Financial Supplement debt, you will need to set up two separate scales in your payroll system. One scale will need to incorporate the SFSS component and one will not – for example, name one ‘scale 2’ and the other ‘scale 22’.
The SFSS component does not apply if the employee has not provided a tax file number (TFN).
Withholding amounts including the SFSS component worked out using the coefficients may differ slightly from the sums of the amounts shown in the PAYG and SFSS tax tables. The differences result from the rounding of components.
Coefficients to work out the weekly amounts to withhold including HELP/SSL/TSL and SFSS components
Your employee’s total withholding, including the HELP/SSL/TSL and SFSS components, can be calculated using the formula and coefficients stated below.
■ a and b are the values of the coefficients for each set of formulas for each range of weekly earnings (or, in the case of fortnightly, monthly or quarterly earnings, the weekly equivalent of these amounts).
If two employees are taxed using a particular scale (for example, scale 2) but only one of them has a HELP/SSL/TSL and Financial Supplement debt, you will need to set up two separate scales in your payroll system. One scale will need to incorporate the HELP/SSL/TSL and SFSS components and one will not – for example, name one ‘scale 2’ and the other ‘scale 22’.
The HELP/SSL/TSL and SFSS components do not apply if the employee has not provided a tax file number (TFN).
Withholding amounts including the HELP/SSL/TSL and SFSS components worked out using the coefficients may differ slightly from the sums of the amounts shown in the PAYG, HELP/SSL/TSL and SFSS tax tables. The differences result from the rounding of components.