How will a second job affect my Tax?

How will a second job affect my Tax?

This is a common misconception out there regarding getting a second job. It’s true, in certain situations a second job can get taxed at just under 50%, but that only happens if you have other income that puts your total income over $180,000.  So that leaves most of us out of that.

The amount of tax you pay on a second job depends on the amount of other taxable income you have.  This amount puts you in a certain tax bracket, which are: 

Tax Rates 2017-18 (not including Medicare Levy)

For example, you work as a shop assistant during the day and do night fill at the local supermarket at night.  Your income from your shop assistant job is $40,000.  This puts you in the 32.5% tax bracket.  So you can earn an extra $47,000 ($87,000 less $40,000) and only pay tax at 32.5%.  If you earn more than $47,000 in your second job, the amount over $87,000 will be taxed at 37%.  As long as your total income is less than $180,000 you will not have to pay the highest rate of tax.  You will end up with more cash in your pocket than what the taxman will get.

A quick warning is that you need to make sure your second job is taxing you right.  If you are not paying enough tax from your second job you will end up getting a tax bill when you do your tax return and you won’t be impressed. 

To make a start, when you start your second job, our first piece of advice would be to say NO to the tax-free threshold.

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Note that the information provided is general in nature and subject to change, please contact one of our professionals who can evaluate your circumstances and provide more accurate advice to your current situation.