Federal Government Taxes

The Federal Government’s taxing authority, known as the Australian Taxation Office (ATO), levies taxes directly and indirectly.

Direct Taxes

Income Tax, the principle tax levied, is a direct tax applied to individuals, companies and trusts. Income tax is imposed on the individual and not on the family, although in certain circumstances the family relationship will have a bearing on individual's tax issues and capital gains issues relating to main residences.

Capital Gains Tax is included with Income Tax - rather than in the UK where Capital Gains Tax is treated as a separate tax.

Indirect Taxes

Goods and Services Tax (GST), is levied at a flat 10% and applied to all goods and services, with certain exemptions mainly relating to medical services, unprocessed foods and exports. It corresponds to the British VAT system.

Customs and Exise Duties

Fringe Benefits Tax (FBT) is imposed on benefits provided to employees, although the tax is applied to the employer. The government considers it more efficient and economical to tax the provider of the tax rather than the beneficiary.

Medicare Levy is an additional impost levied on individual taxpayers. Although not strictly defined as a tax, it is usually levied at 1½% on a taxpayer’s taxable income with exemptions and shading in provisions at the lower rates.