Document ID: chunk:federal_register_of_legislation:F2018L00775:schedule:1:p3
Version: federal_register_of_legislation:F2018L00775
Segment Type: schedule
Provision Reference: sch 1 (pt 3/4)
Character Range: 10518–13151

is greater than his Medicare levy adjustment ($35 – Step 8), his varied withholding amount is $136.

Example 3

Brian is 59 years old and has just commenced receiving weekly superannuation income stream benefits of $1,500. His first payment will be made on 6th September 2017.

The tax free component of Brian's weekly superannuation income stream benefit is $115. The taxable component of the superannuation income stream is $1,385. The taxable component is comprised wholly of a taxed element.

Brian will turn 60 on 3 February 2018. His super fund will make 22 payments before he turns 60 and 21 payments after.

As the taxable component of Brian's superannuation income stream is comprised wholly of a taxed element he will not have to pay any tax on this after he turns 60. The amount to be withheld from each payment should be varied. Brian has claimed the tax-free threshold and is not entitled to leave loading.

Calculate the adjusted withholding amount

Step 1

Calculate Brian's Assessable income before 60th birthday.

Assessable income before 60th birthday: $1,385 x 22 = $30,470

Step 2

Convert the amount calculated at Step 1 into an Adjusted average payment.

Adjusted average payment: $30,470 / 52 = $585.96

Step 3

Calculate Brian's adjusted weekly payment amount.
= $585.99 (ignoring cents, adding 0.99)

Step 4

Calculate the withholding on Brian's adjusted weekly payment amount.

Weekly withholding            = $585.99 x 0.2100 – 67.4646
          = $55.5933
    = $56 per week (rounded to the nearest dollar)

Step 5

Calculate Brian's Adjusted withholding amount based on the amount calculated at

Adjusted withholding          = $56 x 52 / 22
amount         = $132.3636
    = $132 per week (rounded to the nearest dollar)

Step 6

Calculate the per payment superannuation tax offset Brian is entitled to, based on the taxable component of his payment.

Superannuation tax offset: $1385 x 15% = $208 (rounded to the nearest dollar)

Step 7

Calculate the Notional amount to be withheld.
As Brian's Superannuation tax offset ($208 – Step 6) is greater than his Adjusted withholding amount ($132 – Step 5) his Notional amount to be withheld is $0.

Step 8

Calculate Brian's Medicare levy adjustment.

As Brian's assessable income before his 60th birthday of $30,470 (Step 1) is greater than $27,067, his Medicare levy adjustment is:

$30,470 x 0.02 / 22 = $28 (rounded to the nearest dollar)

Step 9

Calculate Brian's varied withholding amount.

As Brian's Medicare levy adjustment ($28 – Step 8) is greater than his Notional amount to be withheld ($0 – Step 7), his varied withholding amount is $28.