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There's a few things to organise before you start your first job. Firstly, you'll need a bank account to receive your salary or wages into. And as soon as you start earning an income, you'll also be required to lodge a tax return and your employer may be required to make superannuation payments into your nominated fund.
If you or someone you know is about to join the workforce for the first time, this guide can help outline what you need to set up before starting work and how to do it. You can also compare a range of different financial products in this guide.
Choose from an extensive range of investment options and enjoy discounted rates on select banking products when you join AustralianSuper.
Superannuation is compulsory for Australian workers. Superannuation is how you'll save for retirement (even though this seems like a long way away now!). If you're over 18 years of age earning a minimum of $450 monthly before tax, you will be entitled to superannuation guarantee contributions from your employer.
Your employer is required to pay 9.5% of your annual earnings into your super fund. This figure will gradually increase over the next few years until it gets to 12%. Similar to tax, your superannuation contributions are something that your employer is required to manage on your behalf. Your employer will pay the super you're entitled to into your nominated fund each quarter.
Your employer may have a preferred super fund, but you're also entitled to choose your own fund. as a young person new to the workforce, it's important to look for a fund that charges low fees. You might also want to consider what insurances you need, if any, included in your super. For example, if you're in your teens you may not think it's necessary to have life insurance or income protection.
*Past performance data is for the period ending June 2020.
If you don't already have one, you'll need to open a bank account in your name to receive your salary or wages into. It's very rare to be paid in cash these days, and even if you are paid in cash it's a good idea to have a bank account to deposit the money into where it's safe.
Your bank account will come with a debit card that you can use to access your money at ATMs and EFTPOS terminals.
You can compare Australian bank accounts in our guide, and open one online for free in minutes.
When you branch out on your own and start earning an income you'll be required to lodge a tax return and pay tax. That is, if you earn enough to be taxed. Working Australians who earn less than $18,200 in a year are not required to pay any tax. If you earn over this, you'll need to pay tax according to how much you've earned.
If you're required to pay tax, you don't personally need to make this payment to the Australian Taxation Office (ATO) yourself (unless you're self-employed). Your employer will withhold a percentage of your pay each payday for tax. At the end of the financial year if you've paid too much tax throughout the year you'll get the amount you've overpaid back. If you haven't paid enough tax, you'll be required to pay the amount owing.
To help manage this process, it's important that you set up your tax file number. This number stays with you throughout your working life, and is used by both your employer and the ATO to ensure you're paying the correct amount of tax. If you don't set up a tax file number your employer will be forced to withhold tax from your salary or wages at the highest tax rate (currently 45%).
What you need to do:
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