Ask LH: How Do I Sort Out Superannuation And Tax At My First Job?

Hello Lifehacker, I’m about to start my first job. I know that taxes and superannuation are involved, but I have no idea how to deal with them. What are the things I need to know before I start working? Thanks, Entering Life

Job picture from Shutterstock

Dear EL,

Congratulations on the new job! The good news is that, for the most part, correctly handling tax and superannuation is something your employer has to deal with. These are the steps you need to take.

Get a tax file number Having a tax file number (TFN) is essential even if you’re only working in a part-time or casual job. While it’s not technically compulsory, if you don’t have a TFN your employer is likely to tax you at the maximum rate and everything will be needlessly complicated. You can fill out the initial application form for a TFN online, but you’ll need to take the completed form to an Australia Post outlet to have identity documents verified.

Set up a bank account Being paid in cash is rare these days. For most jobs, you’ll be paid into a bank account (monthly, fortnightly or weekly depending on the job). You’ll need your account details, including the account number, BSB and account name, so your employer can pay you.

Fill out paperwork for your employer When you start work, your employer will have you fill out a declaration form (you need the TFN for this). Tax will be automatically taken from your salary. If you have a HECs-HELP debt from university study, you’ll indicate that on this form (and additional tax may be withheld to repay the debt if you earn more than a certain amount, something we discuss in detail here).

You’ll also probably fill forms to register for superannuation. Your employer needs to make compulsory contributions into a super fund if you earn more than $450 a month and are over 18. Some workplace agreements require you to use a specific fund; others will offer you a choice.

Complete a tax return once a year In Australia, the tax year runs from 1 July of one year to 30 June of the next year. After that, you have until the end of October to submit your tax return. The main document you’ll need for this is a payment summary from your employer, which must be provided to you by 14 July each year. You can use free e-Tax software from the Australian Taxation Office to submit your return — it’s not as scary as it might sound. We cover tax matters at the end of June each year on Lifehacker during Tax Week; check back here then for a detailed 2014 overview.

There’s a very helpful and detailed Getting Started guide on the ATO web site which covers all this in more detail. Enjoy your new career!


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