As a self-employed care and support worker on the Better Caring platform, you’re in charge of your tax and super. With tax time approaching, here are some tips from Airtax on what you need to get started. You can also check out Airtax’s FAQs page for more detail.
Am I an employee or a contractor?
As an individual providing services it is important to understand whether you are an employee or a contractor as this will impact your tax and superannuation obligations. If you’re an individual working as a ‘contractor’ or sole trader, you are considered to be operating a business and will need to pay tax and super. Find out whether you’re a contractor or employee here.
Do I need to lodge an income tax return?
All individuals (over 18 years of age who were full year Australian tax residents) need to lodge an annual income tax return, unless they earned less than $18,200 and had no tax withheld or paid no PAYG instalments in the financial year.
Do I need an ABN and GST registration?
You don’t need an ABN but clients will likely prefer it. And once you’re earning over $75,000, you will need an ABN to register for GST. GST is payable at 10% and you’ll need to charge it on your invoices. You can organise your ABN and GST registration free of charge with Airtax.
Do I need to pay myself super?
If you are a contractor, you are most likely also required to pay yourself superannuation at a rate of 9.5% of your income. You can find out more about this on the ATO website here. Check out the Superannuation Guarantee Contributions calculator.
Tips for lodging your tax return
If you are a contractor, don’t forget, it is up to you to account for and put aside tax to pay at year-end when you lodge an income tax return. You will also need to set aside the GST payable at the end of each quarter if you are registered for GST. Check out MoneySmart’s tax calculator.
When you disclose your income on your tax return, you should report all sources. This could include allowances, reimbursements, reportable fringe benefits and reportable employer superannuation contributions included on your payment summary. This will help determine surcharges and eligibility for some tax offsets, government super co-contributions and other government benefits.
To reduce your taxable income, you can claim some work-related expenses. These can include car expenses, self-education, First Aid courses and telephone calls. Read more about these expenses and how you can claim them here.
Tax can be complex, but Airtax can simplify it for you. Learn more about Airtax here.
As a Better Caring worker, you can now lodge your tax return through Airtax, a simple and affordable solution for managing your tax affairs. Airtax is available on web, as well as iOS and Android apps so you can do your tax anytime, anywhere.
Note: The above information should not be considered legal, accounting or tax advice. We recommend you speak with an accountant, tax adviser or your financial adviser and we expressly disclaim any responsibility for any action you do or don’t take based on this information.