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Tax deduction - Main Job and Investment

I'm new

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Hi there

 

I have a question about Tax deductions 

English is not my first language so I'm sorry in advance if my scenario may be confused

 

Let say at the end of June

 

I had a main job which generated income with no tax withheld $25,000 

I also owned stocks which generated dividends with no tax withheld $1,000

I did not sell any stocks so no capital lose or gian here 

By using ATO simple tax calculator, I have to pay tax as $1,482 from the total income $26,000

 

I had nothing that relates to my main income that I could declare for tax deduction

However I paid for a service that helps me with tracking my investment like Sharesight $300

 

A question

When I declare tax deduction,

Would the $300 that I paid fully reduce the total tax amount I have to pay?

$1,482 - $300 so I have to pay tax $1,182 or

Would the $300 that I paid only reduce the tax amount on the dividends income?

 

Thank you 

 

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Accepted Solutions

Most helpful response

ATO Community Support

Replies 0

Hello @Sara-Tay

 

Deductions do not directly reduce your tax liability, however they reduce your taxable income (or income that you are taxed on).

 

For example: If you total income was $30,000.00 and your total deductions were $1,000.00, your taxable income would become $29,000.00. This means that you would pay tax on $29,000.00 rather than $30,000.00.

 

Please note that this is just an example to demonstrate how deductions work. It is up to you to self-assess what deductions you can claim.

 

Hope this helps. Have a great day Smiley Happy

 

 

1 REPLY 1

Most helpful response

ATO Community Support

Replies 0

Hello @Sara-Tay

 

Deductions do not directly reduce your tax liability, however they reduce your taxable income (or income that you are taxed on).

 

For example: If you total income was $30,000.00 and your total deductions were $1,000.00, your taxable income would become $29,000.00. This means that you would pay tax on $29,000.00 rather than $30,000.00.

 

Please note that this is just an example to demonstrate how deductions work. It is up to you to self-assess what deductions you can claim.

 

Hope this helps. Have a great day Smiley Happy