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I have accepted a position where I am working under a contract and am essentially self-employed, I spoke to my accountant on the weekend, and he is getting an ABN for me and advised me to put away 15% of earnings for tax and 9% for super.
I feel like I should be putting away more... just wondering what others put away from their earnings? I understand I don't need to do BAS unless I anticipate earning over $75, 000 for the financial year.
Congratulations!
It probably depends on your income. I have calculated the tax I will need to pay annually on my income, and divided it up to work out how much of my fortnightly payment will need to go to the tax man. This goes into a separate account. I also have another account to keep a portion of my income to cover time I take off and in case I am out of work for any time between contracts. As the main income earner for my family that is pretty important for us.
Thanks MR - that makes sense, I will probably do much the same! Thank you for sharing what you do.
That is good you don't have to worry about doing a BAS :D
I have been working under and ABN for 5-6 years now, these days I actually put all my income against my homeloan in the offset account, and just be vigilant with spending ;)
If you need any info on things you can claim back at tax time let me know, after doing it for so long now and working with my accountant, I have reduced my tax payments by a lot :D
Goodluck withy our new work, it is great!
Thanks Beema xox
I am excited... and scared... and excited... and scared
LOL I suppose these are expected feelings for going it on my own
Contracting is great TK. Congratulations!
I've just accepted a 3 month contract with my old employer. I was employed as a contractor through an agency in the past which means they took a cut of my pay but they also took care of my insurance, tax and super. This time I'm going it alone as it cuts out the middle man so more money for us :)
We'll put aside $$ for tax and make extra contributions to my super. I'm on an hourly rate based on my old wage so I'll have a look at my past contributions to super as a guide. The minimum contribution to super by an employer in Australia is 9% so it would be a great idea to make that your minimum too. Also, if you haven't done so already, roll all your super accounts into one then make your contributions via BPAY monthly.
Have you considered insurance? I'm not bothering as I will be working from home for only 10-20 hours a week (a little risky I guess but both DH and I are happy with our decision) but it's definitely worth looking into if you'll be working elsewhere.
Good luck with the return to the workforce. It's quite exciting, isn't it!
I remember all of those feelings, but 5 years downt he track I wouldn't go back and I have to do BAS ;):
