Jowindsor

Hi Everyone,

My OH got a long term contract(Daily Rate).He did the similar thing in UK and he had a limited company and declared expenses and paid tax and stuff..

Is it something similar here,as so far it looks like he rarely gets only 50% as take home?Is there any other way around it?

Many Thanks,
Jo

The Bloke

I am trying to decipher what you are actually asking about. Is he a sub-contractor or an employee on an enterprise bargaining agreement?
Is that 50% that he doesn't get each pay period what they are deducting for his tax? If so, has he advised his tax file number (or ABN if applicable) to the employer? If there is no TFN, tax can be charged at the top rate (47%) until they have been notified.
http://www.oaic.gov.au/law/tax-file-numbers.html

KJCherokee

If he is employed as a contractor he will need to register as either a Sole Trader or a Company. In either case he will obtain an Australian Business Number (ABN) and will need to fill in a Business Activity Statement (BAS) each quarter. He will invoice the company he works for at the agreed rate for hours worked, adding 10% GST (Australian VAT). He will be liable for paying his own tax and superannuation, and will have to pay the GST to the ATO each quarter.

If he is working solely for one company he is liable to be considered an employee by the tax office - the rule is that to be considered as an independent contractor you cannot work more than 80% of your time for one employer.

pumpkin blossom

Interesting. I know lots of people who work on an Abn for just one company, and have done for years. Seems to be the norm for many trades people. You would think the accountants or ATO would have picked up on that.

KJCherokee

I said he was 'liable to', not that he would be! I worked for years on contract to a single company without a problem. The problem is with the employing company who have to pay payroll tax on salaried staff but not on contractors.

paddyo

I'm confused. Is he self employed or employed?
If the former then get an ABN and talk to the ATO, speak to the 'experts' first. If the latter then his employer must of surely told him to get a TFN.