How Much Tax Will I Pay on a Second Job in Australia?

Taking on a part-time or casual second job can be a good way to earn additional income. However, it’s important to understand how this extra money affects your tax obligations for the year. Let’s look closer at how earnings from a second job are taxed in Australia.

Tax Treatment: Both your primary employment and secondary job income are added together to calculate your taxable income for the year. You remain entitled to the same low income tax offset and tax-free threshold, but earnings beyond this will face higher rates.

Tax Brackets: Depending on your combined annual income, additional earnings may push you into a higher marginal tax bracket of 32.5%, 37% or 45%. Single income brackets differ from those who are married or in a de facto relationship.

Claiming Deductions: You can deduct work-related expenses associated with both jobs such as uniforms, training courses and equipment. This can lower your taxable income and potentially save you hundreds each year.

Withholding Tax: Make sure the correct amount of tax is withheld from each pay based on your estimated total income. Too little withheld can leave you with a bill at tax time. Get it adjusted if needed.

Record Keeping: Be disciplined about keeping financial records related to both roles such as payment summaries, bank statements and receipts. Good documentation makes tax return time much smoother.

Seeking Advice: If you have any uncertainties, it may help to consult us, Tax123, your professional online tax return platform. We can guide you on maximizing deductions and withholding the right amount upfront.

With the right preparation, your extra income from a second job doesn’t need to cost more tax than necessary. Approach it properly and you can reap both financial and experience-based rewards.