Working out the weekly earnings

Method for working out weekly earnings

The method of working out the weekly earnings (x) for the purpose of applying the formulas is as follows.

Working out withholding fortnightly, monthly or quarterly amounts

First work out the weekly equivalent of fortnightly, monthly or quarterly earnings. If you pay:

• fortnightly, divide the sum of the fortnightly earnings and the amount of any allowances subject to withholding by 2. Ignore any cents in the result and then add 99 cents.
• monthly, obtain the sum of the monthly earnings and the amount of any allowances subject to withholding (if the result is an amount ending in 33 cents, add one cent), multiply this amount by 3 and then divide by 13. Ignore any cents in the result and then add 99 cents.
• quarterly, divide the sum of the quarterly earnings and the amount of any allowances subject to withholding by 13. Ignore any cents in the result and then add 99 cents.

Then work out fortnightly, monthly or quarterly withholding amounts as follows:

• fortnightly – work out the rounded weekly withholding amount applicable to the weekly equivalent of earnings, before any adjustment for tax offsets. Multiply this amount by 2.
• monthly – work out the rounded weekly withholding amount applicable to the weekly equivalent of earnings, before any adjustment for tax offsets. Multiply this amount by 13, divide the product by 3 and round the result to the nearest dollar.
• quarterly – work out the rounded weekly withholding amount applicable to the weekly equivalent of earnings, before any adjustment for tax offsets. Multiply this amount by 13.

Bi-monthly payments

For payers who make bi-monthly payments, obtain the sum of payments made for the month. Then work out withholding using the monthly steps outlined above. Divide the monthly withholding amount by 2 to determine the bi-monthly withholding amount.

Tax offsets

The withholding amount calculated using scales 2, 5 or 6 of the formulas is reduced as follows:

• weekly – 1.9% of the total amount claimed at the tax offsets questions on the Withholding declaration, rounded to the nearest dollar
• fortnightly – 3.8% of the total amount claimed at the tax offsets questions on the Withholding declaration, rounded to the nearest dollar
• monthly – 8.3% of the total amount claimed at the tax offsets questions on the Withholding declaration, rounded to the nearest dollar
• quarterly – 25% of the total amount claimed at the tax offsets questions on the Withholding declaration, rounded to the nearest dollar.