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INDIVIDUAL TAXATION

Residents are taxed on their worldwide income at progressive rates.

INCOME TAX

Residents are taxed as follows:

INCOME TAX RATES 2007-2008 FOR RESIDENTS

TAXABLE INCOME, AUD (US$*) MARGINAL TAX RATE
Up to 6,000 (US$5,297) nil
6,001 – 30,000 (US$26,484) 5% on band over US$5,297
30,001 – 75,000 (US$66,209) 30% on band over US$26,484
75,001 – 150,000 (US$132,418) 40% on band over US$66,209
Over 150,000 (US$132,418) 45% on all income over US$132,418
* Exchange rate as of 17 October 2007: 1 US$ = 1.13278 AUD
Source: Global Property Guide

In addition, residents are required to pay a 1.5% Medicare levy on their taxable income. A variation may occur on this calculation in certain circumstances. Medicare is a scheme that gives Australian residents access to health care.


PROPERTY TAXATION


LAND TAX

Land tax is an annual tax, levied on all real estate properties, payable by the owner. Exemptions to land tax are extended, mainly, to primary place of residence and farms. The tax base is the assessed value of the property.

Sydney, New South Wales

The tax threshold for 2007 is AUD352,000 (US$310,740). The tax due is AUD100 (US$88) plus 1.7% levied on the value exceeding the threshold amount.

The tax threshold for 2008 is AUD359,000 (US$316,919). The tax due is AUD100 (US$88) plus 1.6% levied on the value exceeding the threshold amount.

Land tax is levied on owners of land; exemptions are extended to homes (principal place of residence), incidental business premise (i.e. home office), permitted occupancies (renting out two rooms in your primary residence) and farms (land use for primary production).

Melbourne, Victoria

Land tax is levied on the total taxable value of all owned land in Victoria. Exemptions apply to a person’s primary place of residence as well as land used for primary production. Properties valued up to AUD225,000 (US$198,626) are exempt from taxation. However, for properties exceeding the threshold amount, the following land tax rates apply for 2008:

2008 LAND TAX RATES
TAXABLE VALUE, AU$ (US$) MARGINAL TAX RATE
Up to 225,000 (US$198,626) 0.11%
225,000 - 540,000 (US$476,703) 0.20% on band over US$198,626
540,000 - 900,000 (US$794,506) 0.50% on band over US$476,703
900,000 - 1,620,000 (US$1,430,110) 0.80% on band over US$794,506
1,620,000 – 2,700,000 (US$2,383,517) 1.30% on band over US$1,430,110
Over 2,700,000 (US$2,383,517) 2.50% on all value over US$2,383,517
* Exchange rate as of 17 October 2007: 1 US$ = 1.13278 AUD
Source: Global Property Guide

Canberra, Australia Capital Territory

Land tax applies to all rateable premises including residential properties that generate income through rent. Land tax rate is different for commercial premises and residential rental properties.

LAND TAX RATE FOR RESIDENTIAL PROPERTIES
TAXABLE VALUE, AU$ (US$) MARGINAL TAX RATE
Up to 75,000 (US$66,209) 0.60%
75,000 – 150,000 (US$132,418) 0.89% on band over US$66,209
150,000 – 275,000 (US$242,766) 1.15% on band over US$132,418
Over 275,000 (US$242,766) 1.40% on all value over US$242,766
* Exchange rate as of 17 October 2007: 1 US$ = 1.13278 AUD
Source: Global Property Guide

 

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