Question

During the 2017/18 tax year, Selina Matterson (a single resident taxpayer, aged 41) has the following receipts:

• Net salary (after $18,000 PAYG tax withheld) $55,000
• Fully franked dividend from PPP Ltd $9,800 (with franking credit $4,200)
• Unfranked dividend from QQQ Ltd $900
• Net interest received $954 (after $846 no TFN tax withheld)
• Selina had no deductions
• She was covered by private hospital insurance

Required:

Calculate Selina’s taxable income for the 2017/18 tax year.

Calculate Selina’s net tax payable/refundable (including Medicare Levy) for the 2017/18 tax year.

Show your working

Answer 1

a) Calculation of Selina’s taxable income for the 2017/18 tax year.

Particular	Calculation	Amount
Net Salary	55000+18000	$    73,000
Fully franked dividend	given	$      9,800
Unfranked dividend	given	$          900
Net interest received	given	$          954
Taxable Income		$    84,654

b)Calculation of Selina’s net tax payable/refundable (including Medicare Levy) for the 2017/18 tax year.

Particular	Calculation	Amount
Tax for 2017-18, as single status	5226.25+(25%*(84654-37950)	16902.25
Medicare levy,2% of the taxable income	2%*84654	1693.08
Less: Franking credit		-4200
Less: TFN tax withheld on interest		-846
Tax payable		13549.33