How My Taxes were distributed

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Originally Posted by incisor

sorry frantic but for me that first and second sentence is utter drivel in the majority of circumstances.

the third sentence is closer to reality, but the bar starts a lot higher than the vast majority of mum and dad small business / sole traders.

the stats show many are just getting by.

the stats also show that the majority would drop everything and go with paid employment if they could only get that decent job with super and all the perks many workers take for granted.

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This.

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Originally Posted by frantic

Y... how many chip pies, brickies, plumbers, painters, plasterers, tillers,sparkles ,roofers, concreters etc are working for the same builder 5-6 days a week, for decades.

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Numerous lawyers are paid through their firm as a subbie to reduce their tax, go and talk to their ex wives for a full description of how to avoid both tax and child payments

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The building industry... With regard to whether your mates are really contractors or employees - you can read about it here (Making employment look like contracting), on the other ATO links on that page and make your own judgements.

The question of whether the tax system is fair to different categories of tax payers and the question of whether tax avoidance (and avoidance of other obligations) by any category of tax payer is fair are different questions.

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Originally Posted by frantic

when he moved employer, SAME JOB, but was paid a normal wage(same , if not higher before tax) as that group would not employ him as a sub contractor. The only benefit he got was super and a few weeks extra paid holidays(his industry shuts from dec 15-20ish-mid January every year).Working there his actual take home pay shrunk as he was paying the same tax as me. so before he was paying say as a simple example $10 tax/pay averaged out over a year , now he was paying $30 tax each fortnight. Combine this with the tax taken each pay, not each quarter or year and it was a big drop.

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Mate your friend would be caught by the PSI rules. Personal Services Income. He would only be entitled to the same deductions to those that any ordinary employee would.

Anything else, he (and his Accountant) are lodging an incorrect return and at risk of an Audit. The back tax, interest and fines would destroy him.

Sounds like rubbish tax advice bordering tax fraud given his intent.

was going to mention PSI. but this tax stuff is so complex and a car forum comprised of car enthusiasts may not be the best place for an expert opinion based on the facts.

then again i dont know much about cars and i happily post on this forum so what do i know. :)

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Originally Posted by mns488

Mate your friend would be caught by the PSI rules. Personal Services Income. He would only be entitled to the same deductions to those that any ordinary employee would.

Anything else, he (and his Accountant) are lodging an incorrect return and at risk of an Audit. The back tax, interest and fines would destroy him.

Sounds like rubbish tax advice bordering tax fraud given his intent.

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Been audited ok :D
He just retired, except for that 5 year period 6-11 years ago he was a contractor. The companies he worked for have names that start with M, B,A, H. Each one of these home builders would do 2-500 homes a year in Sydney and the first 2 have regularly done 200+ on the south coast/Illawarra. How many of the builders on here could do 20-30 a year, as when he was working for the local H franchise the 3 chippie owners had problems keeping up with sales of 20 each, along with obtaining adequate insurance to cover the jobs at various stages.

One of his good friends has just left B as the wood bitches never raised his pay per job for a decade as a plasterer. The way they get around it depending upon current laws is pretty simple. One common method was to have 3 managing companies, and the subbies got paid one job from each, that changed after the laws changed.

The one he worked for who paid him as a PAYE sold around 200+ from one office with a advertised average build time of 17 weeks. They have 3-4 sales centres in Sydney and one down here.