Country is Australia and below is the tax bracket Effective

Country is Australia, and below is the tax bracket

Effective tax rate 0% 0-9.65% Taxable income $1- $18,200 $18,201 - $37,000 19c for each $1 over $18,200 $37,001 _ $87,000 $3,572 plus 32.5c for each $1 over $37,000 9.65-22.78% $87,001 _ $180,000 | $19,822 plus 370 for each $1 over $87,000 22.78-30.13% $180,001 and over $54,232 plus 45c for each $1 over $180,000 30.13-less than 45% Tax on this income Nil

Solution

The net income of a trust is taxed in the hands of the beneficiaries based on their share of the trust\'s income (the share they are \'presently entitled\' to) regardless of when or whether the income is actually paid to them.

As the three of the beneficiaries (Henry, Allison, and Peter) are Minor (less than 18 years of age). Those share of profit will be taxed in the hand of trust.

Calculation of Gross Tax

Total Income = $45,000

Less: Deductions: Henry\'s University Fee = $ 2,000

Taxable Income = $43,000

Tax on $1- $18,200 = 0

Tax on $18,201 - $37,000 = 18,800 * 19c = 357,200c = $3,572

Tax on $37001 - $43,000 = 6000 * 32.5c = 195,000c = $1,950

Total Tax = $3,572 + $1,950 = $5522

>>>> Medicare Levy will be 2% on Taxable Income, i.e. $43,000 * 2% = $860.