How much tax do relief teachers pay?
Schools withhold income tax just like any other employer. As a relief teacher, this means that you will be paying tax according to the Australian Resident Tax Rates:
|Taxable Income||Tax on this income|
|0 – $18,200||Nil|
|$18,201 – $45,000||19 cents for each $1 over $18,200|
|$45,001 – $120,000||$5,092 plus 32.5 cents for each $1 over $45,000|
|$120,001 – $180,000||$29,467 plus 37 cents for each $1 over $120,000|
|$180,001 and over||$51,667 plus 45 cents for each $1 over $180,000|
For relief teachers, calculating how much tax that you will pay will depend on how much money you earn over the entire year. What this means is that if you are a starting teacher working for the Department for Education and earn $350.09 per day, you will need to add all of the days that you work together at the end of the financial year before you can determine how much tax you should have paid throughout the year.
If you are working for an Independent school in Australia, you will earn a different daily rate than working in public schools. However, you will pay the same amount of tax if you are earning the same income.
Why do I seem to pay too much tax as a relief teacher?
Relief teachers, like other employees in Australia, have a percentage of their pay withheld by their employer each pay period. This is called PAYG or Pay as you Go, and it means that you are paying your income tax throughout the financial year and don’t need to worry about paying a tax bill at the end.
Sometimes as a relief teacher, you might look at your payslip for the fortnight and notice that you have paid 45% or more in tax. This can be very concerning, as you are unlikely to be earning in the tax bracket that would require paying that much tax. What happens as a relief teacher who is casually employed, is that you will pay tax equivalent to what your income would be if you were given the amount of pay on your payslip every fortnight. As a relief teacher, you can’t work during the school holidays and you may not work every day, so you will always be paying too much tax during the year.
Because the pay per day for relief teachers is quite high, you will have a lot of money withheld for tax. If you are working every day for the fortnight and earn $3500.09, you will have tax withheld as if you were getting paid that amount for the entire year. Sometimes, you may not have much tax withheld for the fortnight that you were paid this high amount. You may find that it was withheld at a much higher rate during the next pay period instead. This can particularly hurt if you didn’t work many days in the next pay period.
What do I do if I am paying too much tax as a relief teacher?
As a relief teacher, you are a casual employee who has a high daily pay rate, but cannot work every day of the year. This means that you will always have more tax withheld than you need to pay during the year.
The first thing that you can do if you think that you are paying too much tax is to make sure that you are claiming the tax-free threshold in the schools that you are working for. This is a box that you will tick when you submit your pay forms that include all of your information such as your Tax File Number (TFN). If you tick this box, you are declaring that you would like this employer to assume that you are not receiving any other income than what they are paying you, and will withhold tax at a lower rate. If you do not tick this box, your employer doesn’t know how much you are earning and may tax you at the highest possible rate.
The only other thing that you can do if you are paying too much tax as a relief teacher is to wait for the end of the financial year so that you can get your tax return. As long as you supply your TFN to all of your employers, the amount that you have been paid for the financial year will be automatically sent to the Australian Taxation Office (ATO). This means that you will not have to enter all of your pay from all of your jobs yourself, and the ATO will automatically suggest how much tax you should have been paid.
As a relief teacher, the amount of tax that you have paid will be higher than the amount that you need to pay. The ATO will automatically estimate how much money you will get back on your tax return for you to confirm and submit.