Tax on a bonus

[Frantelle]

I got a $1000 bonus this week (yay). It is also pay week.

Should my wage be added to my bonus and I get taxed on the whole amount or should I be taxed on my wage and then on my bonus???

If anyone could help that would be great

[Em_325]

I get an annual bonus and it is always taxed separately to my normal wages. They also make 2 seperate payments so I get one for my nomal weekly wage, then another with my bonus.

[Astrid]

Bonuses can be processed together with your normal wage or separately. Either way payroll needs to know what they are doing when they are taxing a bonus and make the necessary tax adjustments on your pay (if the payroll system does not handle automatically).

There is a rather complicated formula to do with taxing bonuses. Essentially though, they tend to be taxed around your marginal tax rate.

The last thing you want is for it to be processed as a separate pay and they take into account the tax free threshold a second time in one pay period, as you will not have paid enough tax for the year.

See NAT 3348 with the ATO for the whole info on taxation of bonuses

[Frantelle]

Thanks for the info.