Calculating and paying income tax

Economics & Business Year 8 AC v9.0 100

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Introduction

In this activity, students are introduced to the Pay as you Go withholding system and the tools they can use to find out how much tax should be withheld from their pay and how they can check that the right amount was withheld. They consider what they can do if their employer is not deducting the correct amount of tax.

Achievement standard

By the end of Year 8, students explain how markets influence the allocation of resources to the production of goods and services. They explain ways that businesses adapt to opportunities in markets and respond to the work environment. They describe the importance of Australia’s taxation system and its effect on decision-making by individuals and businesses. Students explain why individuals and/or businesses budget and plan.

Students develop a range of questions to investigate an economic and business issue. They locate, select and organise relevant information and data. They interpret information and data to identify economic and business issues and trends, and describe economic cause-and-effect relationships. They develop a response to an economic and business issue. They identify and evaluate potential costs and benefits. Students use economic and business knowledge, concepts, terms and research findings to create descriptions and explanations.

Content descriptions

Economics and Business Knowledge and Understanding

The importance of Australia’s system of taxation and how this system affects decision-making by individuals and businesses. (AC9HE8K04)

Economics and Business Skills

Interpret information and data to identify economic and business issues, trends and economic cause-and-effect relationships. (AC9HE8S03)

Develop a response to an economic and business issue, identifying potential costs and benefits. (AC9HE8S04)

Create descriptions and explanations, using economic and business knowledge, concepts and terms, and referencing information and data from sources. (AC9HE8S05)

Teacher resources

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Video

Using the tax withheld individuals calculator

Student learning resources

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Explainer

Calculating and paying income tax

 
Worksheet

Was the correct amount of tax withheld?

 
Information

Weekly tax tables

Suggested activity sequence

This sequence is intended as a framework to be modified and adapted by teachers to suit the needs of a class group. If you assign this activity to a class, your students will be assigned all student resources on their 'My learning' page. You can also hand-pick the resources students are assigned by selecting individual resources when you add a work item to a class in 'My classes'.

Part A: Income tax

  1. Ask students if they have a job and receive a payslip. How often and if they check it? What do they check?
  2. As a class, read the ‘income tax’ and ‘how do you pay tax’ sections of the explainer, clarifying terms and concepts. Alternatively, students read these sections of the explainer individually or in pairs and take notes using the Cornell note taking system.
  3. Students can choose one of 2 tools to work out how much tax should be withheld from their pay:
    • weekly tax tables on the ATO website
    • ATO app Tax withheld calculator (simplified version)
  4. Demonstrate to students how to access weekly tax tables on the ATO website.
  5. Play the video on the ATO app Tax withheld calculator. Explain to students they can download the app on their devices using Google Play or the App Store.
  6. Students complete part 1 of the worksheet.
  7. Invite students to share their responses.

Part B: Was the correct amount of tax withheld?

  1. As a class, read the ‘How do I know how much tax was withheld from my pay?’ section of the explainer. Alternatively, students read these sections of the explainer individually or in pairs and take notes using the Cornell note taking system.
  2. Students complete part 2 of the worksheet.

Part C: Develop advice

  1. Use a grouping strategy to organise students into groups of 4.
  2. Groups complete part 3 of the worksheet.
  3. Post group products on the wall and conduct a gallery walk so all students can view the products of other groups.

Useful prior learning