Suitable for: Anyone who pays tax
Tax Difficulty: Beginner
Airtax Experience: Anyone
Time to read: 3-4 minutes
Definitions for common tax terminology
Don’t be confused by tax jargon and acronyms - here’s a list of the most common tax terms you’ll need to know as a taxpayer.
ATO (Australian Taxation Office) |
The ATO is the Australian government department for tax. |
GST (Goods and Services Tax) |
GST is a tax on most goods, services and other items sold in Australia. The current rate of GST is 10%. |
GST Credits |
A GST credit is the amount of GST included in expenses you have paid to help run your business operations. |
PAYG (Pay As You Go) Instalments |
Where earning income outside of regular salary and wages from which your employer withholds tax, the ATO may require you to pay tax instalments towards your end of year tax liability once per quarter. These instalments are known as PAYG instalments and are based on an estimate of your tax payable based on your most recently lodged tax return. Learn more here. |
PAYG (Pay As You Go) Withholding |
PAYG withholding is the tax withheld throughout the year from your earnings by your employer. This amount will be included on your end of year payment summary and should be included in your tax return as ‘tax withheld’. |
BAS (Business Activity Statement) |
If you are registered for GST you will need to lodge regular BAS’s with the ATO. A BAS helps you report and pay the GST that you owe the ATO by reporting the GST you received and paid during the period, as well as your PAYG instalments if required. It only takes a couple of minutes to complete your BAS on your mobile with Airtax - and for only $49, find out more here. |
Income tax return |
An income tax return is an annual tax lodgement required for nearly all individuals, which must be lodged with the ATO. In your return, you will outline your income from all sources and any relevant and allowable deductions - the result of which will show your taxable income or loss. Get your income tax return done in minutes with Airtax for only $99, find out more here. |
Assessable Income |
Assessable income is basically the income you have earned during the year from all sourcing, including from any taxpayers business activities. This needs to be reported in your annual income tax return. You can find out more here. |
Allowable Deductions |
Allowable deductions are expenses that the ATO has determined can be included in your income tax return as a deduction. Expenses which can be considered deductions differ depending on who is claiming them and the type of work undertaken. You can find out more here. |
Taxable Income |
Taxable income is your assessable income less your allowable deductions. This is the amount you pay tax on at the end of the year. |
Got a Question?
If you want to speak to someone about your current Airtax income tax return, book in a Tax Assist call or Tax Professional call with a tax specialist.
This document merely provides a broad outline of the subject and is necessarily general in nature. If you require specific advice, which is tailored to your specific circumstances, please do not hesitate to contact us (fees would apply).