My annual bonus is always been paid seperate to my normal pay, I thought that was how it was meant to be done?
I'd have your DH ring his payroll just to confirm! That's a major pain
Turk EnJayDee (12-09-2012)
When I've received bonuses (twice a year), I get my normal pay taxed exactly as it is every week, then the bonus is included on the same pay slip but taxed at the correct (enormous) rate.
Hope that makes sense!
Last bonus I lost $1000 to tax
Well I called the ato and of course they have no idea about anything. But said if it's a lump sum (I'm pretty sure it's still considered salary on group certificate) that it will be taken in to consideration when we do tax next year.
I think it's a load of crap. Because of this, DP's salary payment was almost half what it normally is and the bonus we got was pathetic.
It's so crap that you work your butt off, bust your guts all year and then mr tax man gets your hard earned bonus. I know tax money us needed for all sorts and thats fine, but bonuses shoukd be exempt from tax. Would that not boost the economy?
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You won't pay extra tax in the long run, as it's subject to normal tax rates, but you may not get it back for almost a year now, so it would be better if it was taxed appropriately at the time, as it's better in your hands than the ATO's.
eg. if the annual salary was $60,000 and the bonus was $10,000, you pay tax on $70,000, and the $10,000 payment would attract about 30% tax (i think thats the relevant rate for that bracket, or thereabouts).
Perhaps talk to the employer, and get them to separate it from the fortnightly pay, and ask them to tax it by taking into account the annual salary?
they would never stop taxing bonuses, as people would use it for tax avoidance, eg. a salary would include a bonus component when it's not truely a bonus, to avoid tax. they would say that a component was a bonus, but really it was guaranteed. In any event, it is income.
If bonuses were exempt from tax then everyone would get tiny salaries and huge bonuses, and tax rates would go through the roof!
It does seem unfair. But you will get a lot of the tax back at the end of the year.
Dhs are always paid like that, it's crap but they won't change it. His company was recently bought out so payroll is done by the new company and they do it the exact same way.For our businesses we process seperatly normally, one girl asked for hers to be done altogether so she pays the higher tax rate so hers is done that way...we only have 30 employes in 2 businesses though so not much trouble for me to change.
When i process bonuses at work they go through as an 'allowance' and taxed with the fortnightly.pay. Its normally alot of.tax but it works out that u get it back at tax time.
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