Understanding

Salary & Wage Earnings

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Payslips & Tax Withholding

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As an employee, your employer will deduct tax from your salary and send it to the Australian Taxation Office (ATO).

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Your payslip should include details such as:

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• Gross pay (your earnings before tax and deductions)

• PAYG (Pay As You Go) tax withheld

• Superannuation contributions

• Any additional deductions (e.g., salary sacrifice, union fees)

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To ensure you’re paying the right amount of tax, check that your employer is using the correct tax-free threshold and applicable deductions.

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Superannuation Contributions

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Your employer is required to pay superannuation contributions on top of your salary, currently set at 11% of your ordinary earnings (as of July 2024). You can also make additional voluntary contributions to boost your retirement savings, which may have tax benefits.

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Tax Deductions for Employed Social Workers

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You may be able to claim work-related expenses to reduce your taxable income. Some common deductions include:

• Professional Memberships: Fees for AASW.

• Work-Related Education: Courses, seminars, and conferences that improve your skills.

• Work Equipment: Items such as uniforms, therapy tools, or home office expenses (if required for work).

• Travel Expenses: If you travel between workplaces, you may be able to claim car expenses or public transport costs.

Keeping accurate records and receipts is crucial for claiming these deductions at tax time. Your accountant will be able to help you with what you can and cannot claim  Keep your receipts.

For more on tax deductions CLICK HERE

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Medicare, NDIS & Private Health Fund Considerations

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While your employer handles most financial aspects of your work, it’s important to understand how different funding systems impact your role:

• Medicare & NDIS: Your employer may bill under these programs, but your wages are not directly affected.

• Private Health Insurance: Some services attract rebates from health funds, but this does not impact your salary or tax directly.​​​

 

Annual Tax Returns

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Each year, you’ll need to lodge a tax return with the ATO. Your employer will provide a PAYG Payment Summary (Income Statement) through MyGov, showing how much you earned and how much tax was withheld. By claiming eligible deductions, you may be able to reduce your taxable income and increase your refund.

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Need Help Managing Your Finances? 

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Understanding your income, tax, and deductions can help you make better financial decisions. If you're unsure about your tax situation, seeking advice from an accountant with experience in allied health can ensure you're compliant while maximising your tax benefits.