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  1. #11
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    Quote Originally Posted by Jellyfishie View Post
    I also find it amusing when people say they are paying 45% tax (or 50 as was claimed in previous threads!). I wonder if they realise they only pay that on the portion of their income which falls above the last tax bracket...I suspect they think it is 45% of their total income. Incorrect.
    Surely people in that tax bracket know enough about their finances to understand? I think usually they are referring to that money that falls into the highest threshold. And this is what I was getting at in the other thread; if you're already in or nudging that threshold, there can be a severe disincentive to putting your neck out to earn more when the perception is that the returns will just be slashed. Think about a small business owner who already receives a comfortable income but is contemplating a risky venture. Where's the incentive for them to take that next step? If they don't succeed their losses could be great, and if they do succeed their returns will be heavily taxed.

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    Default Re: Taxes - what do we really understand about them?

    Great topic. I too often bang my head when people don't quite understand how it all works, but ate trying to say XYZ, when it's not the case.

    I'll have a proper read and contribute more when I'm not on my phone

    *I can haz typos*

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    Default Taxes - what do we really understand about them?

    I think generally when people say they pay 45% tax they are simply saying they are in that particular bracket.

    It's far less of a mouthful than saying 'I pay $54k + 45c on each $1 above $180k + the Medicare surcharge'.

    Same goes for all brackets really.

  4. #14
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    headoverfeet is offline The truth will set you free, but first it will **** you off. -Gloria Steinem
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    Quote Originally Posted by shelle65 View Post
    It estimates your tax liability, and if it works out to be too much you get whatever you have overpaid back as a return from the tax office.
    What fairy land do you live in? Seriously can I come live there? I am sick of being over taxed (at the moment we are being taxed at the top of our pay bracket when we below the middle) and getting nothing back. Or getting something back and then a few months later getting a bill for some of it to be returned! How freaking hard is it

    If you do the maths we are loosing $50 a week, we got $800 back than got a bill for $260! Sorry but I feel the need to complain about that. And that doesn't take into account deductions

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    Quote Originally Posted by NancyBlackett View Post
    I think generally when people say they pay 45% tax they are simply saying they are in that particular bracket.

    It's far less of a mouthful than saying 'I pay $54k + 45c on each $1 above $180k + the Medicare surcharge'.

    Same goes for all brackets really.
    And this was how I worked it out.

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    Default Taxes - what do we really understand about them?

    Quote Originally Posted by headoverfeet View Post
    What fairy land do you live in? Seriously can I come live there? I am sick of being over taxed (at the moment we are being taxed at the top of our pay bracket when we below the middle) and getting nothing back. Or getting something back and then a few months later getting a bill for some of it to be returned! How freaking hard is it

    If you do the maths we are loosing $50 a week, we got $800 back than got a bill for $260! Sorry but I feel the need to complain about that. And that doesn't take into account deductions
    This doesn't make sense. Either you pay too much and (by definition) are owed a refund, or you don't pay enough and end up owing a debt.

    Have you seen an accountant?

  7. #17
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    Quote Originally Posted by lambjam View Post
    This doesn't make sense. Either you pay too much and (by definition) are owed a refund, or you don't pay enough and end up owing a debt.

    Have you seen an accountant?
    I know it doesn't make sense! When I called the ATO I was told it was 'right' only to be sent a bill a few months later Nope

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    Default Taxes - what do we really understand about them?

    Quote Originally Posted by headoverfeet View Post
    I know it doesn't make sense! When I called the ATO I was told it was 'right' only to be sent a bill a few months later Nope
    I'd make an investment in consulting a tax professional. Their fees aren't that steep (especially compared to what you could be losing in tax!) and are tax deductible too

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    I would see an accountant HOF, something isn't right there.

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    Default Taxes - what do we really understand about them?

    Quote Originally Posted by headoverfeet View Post
    What fairy land do you live in? Seriously can I come live there? I am sick of being over taxed (at the moment we are being taxed at the top of our pay bracket when we below the middle) and getting nothing back. Or getting something back and then a few months later getting a bill for some of it to be returned! How freaking hard is it

    If you do the maths we are loosing $50 a week, we got $800 back than got a bill for $260! Sorry but I feel the need to complain about that. And that doesn't take into account deductions
    Sorry I have no idea what you are saying, but I think you have just proven my point.


 

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