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Posted 15 February 2011 - 03:35 PM
Ok, DP has recently gone from being a self contractor to contracting for a company.
In the last week he was sent to 2 different job sites both paying different hourly rates.
On the lower rate of pay DP worked approx 2 days (16 hours) was taxed approximately 8% which seemed reasonable.
On the higher paying job he also worked 24 hours at normal rate and then a saturday for 8 hours (at which he would have been entitled to time and a half and then double time. He was taxed 29%.
Im earn a fairly decent wage and have never paid more then 20% tax.
Does this seem right?
Also on the hours he was meant to get time and a half he was $3.00 short per hour and 5 short per hour on double time?
DP has questioned the payroll officer and they have told him it is correct. They also said if he keeps questioning it they just wont contract him out anymore?\
This all sounds rather dodgy to me. What do you think?
Posted 15 February 2011 - 04:27 PM
It is probably about right. You can only claim the tax free threshold on one job so the tax on a second job is going to be much higher. At the end of the year when the tax return is done the 2 incomes will be added together to calculate the correct tax amount on his combined wages. Any extra tax he has paid will be refunded then. This really just means that he is paying a lot of tax on one job now but he will get it back at tax time.
Posted 15 February 2011 - 04:31 PM
Sounds right to me. The PP sounds spot on. It works out at the end of the FY.
Posted 15 February 2011 - 09:39 PM
is he in actually employed & paid by the company who then contract him out to other jobs? Is he paid in full by the company or by the individual sites where he does the jobs?
I would think that if he is being paid in full by the one company that would count as 1 employer and tax should be calculated based on the combined earnings.
In regards the the variance in overtime rates he has every right to ask for an explanation as to how the rates have been calculated.
Posted 16 February 2011 - 12:02 PM
I would ask if time and a half and double time is calculated on the award rate or his normal hourly rate. My first job it was based on the award rate so double time was never actually double.
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