Tax Offsets in Australia

Part of the Tax for Australians For Dummies Cheat Sheet

When figuring taxes in Australia, you can use tax offsets to reduce your tax payable. You can’t use tax offsets to reduce the Medicare levy liability.

Ordinarily, you can’t have unused tax offsets refunded back to you. The three exceptions are

  • Baby bonus tax offset

  • Franking credit tax offset

  • Private health insurance rebate

Eligibility for the low income tax offset is applicable to low income resident individuals, as shown in the following table.

Low Income Tax Offset in Australia
Maximum tax offset $445
Taxable income threshold $37,000
Taxable income upper limit $66,666

Residents born before 1 July 1957 receiving net income from working are eligible to receive the mature age tax offset. The maximum tax offset is $500.

Common dependant tax offsets include spouse, child-housekeeper, invalid relative and parent/parent-in-law.

You can claim a franking credit tax offset if you receive a dividend that's franked. Unused franking credits can be refunded to you.

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Tax for Australians For Dummies Cheat Sheet