Your Tax Matters

Taxation and Accounting Services

Telephone:  (03) 59 761659

 Under 18 years of age Income Tax rates in Australia

 

There are special rules that apply to people who are under 18 years of age and earn income.  If you are under 18 years your income is classified as excepted income or non-excepted income.  Depending on the income classification it is taxed at different rates.

 

If you are classified as an excepted person you will pay the same tax rate as an adult but if you are not classified as an excepted person or your income is not classified as excepted income you will pay a higher rate of tax on your income. 

 

Excepted Person and Excepted Income

 

To be classified as an excepted person you must have:

 

  • finished full-time study and are working full time

  • disabilities, or

  • be  entitled to a double orphan pension

 

 For your income to be classified as excepted income it must be from:

  • employment income

  • taxable pensions or payments from Centrelink or the Department of Veterans’ Affairs

  • compensation, superannuation or pension fund benefits

  • income from a deceased person's estate, including income derived by a testamentary trust from property of the deceased person's estate

  • income from property transferred to you as a result of the death of another person or family breakdown, or income in the form of damages for an injury you suffer

  • income from your own business

  • income from a partnership in which you were an active partner

If you have excepted income, your excepted net income (that is, excepted income minus deductions relating to that income):

  • is taxed at the same rates as an adult's net income

  • any tax payable is reduced by any low income tax offset or low and middle income tax offset you are eligible for.

 

For any other income you receive:

  • you are taxed at a higher rate

  • any tax payable is not reduced by the low income tax offset or low and middle income tax offset


 

Non-Excepted person and income that is not excepted income

 

If you aren't an excepted person, you pay a higher rate of tax for income that is not excepted income and your tax payable is not reduced by the low income tax offset or low and middle income tax offset . This rule was introduced to discourage adults from diverting income to their children.