# How can a PR save income tax in Australia?



## anmolpuri (May 12, 2012)

Dear experts,
I will be moving to Sydney this month end and would subsequently be looking for employment.
Can someone please give tips on saving income tax, specially for PRs. I will be moving with my wife who would also be looking for a job and we have no kids.
Also, are there any state taxes also. I'm going to Sydney.
If there is already a thread on this topic, please point me to it.
Cheers
Anmol


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## pcrial (Sep 27, 2010)

*Income Taxes*

How can a PR save income tax in Australia?

The only sure way is to have less income. It is also a fact, the only way to pay no income tax is to have no income.

I would assume, unfortunately, these axioms are counter productive to your goals. If your goal is to have enough income to live comfortably, then paying more taxes would be your answer. 

My father once said, "I wish I had to pay one million dollars per year in income tax". I asked, why would you want to pay so much? His answer, "if I paid one million per year in tax, look how much I would get to keep.

So the answer to your question is, it is not how much you earn, or how much tax you pay, rather, how much of what you earn you can keep." Suppose your income tax rate is 35%, and you earn $100k/year, with a tax of $35,000 leaving $65,000 for you to keep. If you double your income to $200,000 the amount you keep is much larger although not double, because of the income tax rate creep nevertheless larger. Increase you income, and increase the amount of money you can keep. Perhaps you should be hoping to pay more taxes?

Cheers,


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## anmolpuri (May 12, 2012)

Hi pcrial,
Your point is valid and I agree with what your father said..I wish I pay a million dollar tax as well 
But my question was more specific.. i wanted to know ways of reducing the taxable income with the same income... In my country, things like investments in shares, mutual funds, education loans, insurance or home loans reduce the taxable income and consecutively the tax payable. I just want to understand the scenario in Australia.
Cheers
Anmol


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## pcrial (Sep 27, 2010)

anmolpuri said:


> Hi pcrial,
> Your point is valid and I agree with what your father said..I wish I pay a million dollar tax as well
> But my question was more specific.. i wanted to know ways of reducing the taxable income with the same income... In my country, things like investments in shares, mutual funds, education loans, insurance or home loans reduce the taxable income and consecutively the tax payable. I just want to understand the scenario in Australia.
> Cheers
> Anmol


Hello anmolpuri,

The deductions in the USA are similar to what you mention in India. Australia is different, in there are not nearly as many deductions. I did find a couple of articles about maximizing your deductions. 

Reducing tax by maximising tax deductions | Flying Solo

http://www.taxpayersassociation.com.au/tax-deductions/tax-deductions.html

Your education, perhaps a home office (although I'm told this one can bite you in the butt when you sell your home) and a few other deductions are available.


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## hasib (Jun 18, 2012)

please let me know the SLAB or tax rate of Australia.
suppose i am earning 50K/year then how mauch slab will be applicable


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## pcrial (Sep 27, 2010)

hasib said:


> please let me know the SLAB or tax rate of Australia.
> suppose i am earning 50K/year then how mauch slab will be applicable


The ATO website has quite a few tools for preliminary estimates of your situation.
Rates, calculators & tools


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## jan7 (Mar 22, 2011)

anmolpuri said:


> I just want to understand the scenario in Australia.
> Cheers
> Anmol


Hi Anmol,
in that case you might want to read this blog
Tax return: Simplified

It'll give you a good look at tax scenario in Australia. Hope that helps.

Cheers


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## Maz25 (Jul 6, 2008)

anmolpuri said:


> Hi pcrial,
> Your point is valid and I agree with what your father said..I wish I pay a million dollar tax as well
> But my question was more specific.. i wanted to know ways of reducing the taxable income with the same income... In my country, things like investments in shares, mutual funds, education loans, insurance or home loans reduce the taxable income and consecutively the tax payable. I just want to understand the scenario in Australia.
> Cheers
> Anmol


I would suggest that you speak to a registered tax accountant, who will be able to guide you based on your personal circumstances.


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