By Brenda Fry.
There are lots of issues to consider if your teenager is starting work, from tax rules to balancing work and school commitments. Here are the top things we think you should know as a parent of a working teenager.
- Your teenager will need a tax file number (TFN), otherwise their employer will be required to withhold up to 50% of their income in tax.
- If your child is 12 years of age or younger a parent will be required to sign the application form and they will need to provide two forms of identification.
- If your child is at secondary school, the easiest way for them to get a tax file number is if the school is part of the Secondary School TFN program. The school will verify the child’s identity for you. If the school is not part of the program, they will need to complete an application formand supply three forms of identification.
- The tax free threshold for 2012/13 financial year is $18,200. If the child’s income is under this they will not be taxed.
- Your child must remember to claim the tax free threshold on their tax file number declaration but remember this can only be claimed for one employer.
- If the payment summary received from the employer at the end of the financial year shows that your child is under the threshold but has paid some tax, they can lodge a return to get a refund of some or all of the money.
- More information and application form available at the Australian Tax Office website.
- To be eligible to have contributions made by an employer while you are under the age of 18 the child must work a 30 hour week and earn over $450 gross in a calendar month (this may occur over school holidays)
- If your child falls into this category, the compulsory amount of superannuation to be paid into their super account by their employer is 9% of their earnings.
- Encourage your teenager to get a head start on their superannuation by making additional payments to their super fund after tax.
Opening a bank account
- Your child will need to open a bank account so their employer can pay them directly.
- They can apply to open a bank account online.
- They will need to provide their TFN during the application process or take it to the branch later.
- If this is their first account with the bank they will need to attend the bank with 100 points of identification. This can be their birth certificate or passport as primary ID which is worth 70 points. A learners permit, student ID card, and Medicare card should see them clear to 100 points.
- A second, high interest online account could be opened to encourage savings for a car, overseas trip or university expenses. Don’t forget to advise of any interested earned on the tax return at the end of the year as this is also considered income.
- Discuss with your teenager a realistic start time for work, to allow enough time between finishing school and getting to work. This way they won’t be late or stressed about getting there on time.
- Discuss also how much work they would like to do, and what is a good balance between work time and school time. Don’t forget kids need time to socialise and to do nothing at all to recharge their batteries.
- You could help them create a timetable of work and homework to ensure they have enough time to complete everything and not neglect either responsibility.
Other articles in our job series for teenagers
Let us know if we’ve missed anything, and we’ll add it to the list.
This article was written by The Kids Are All Right intern Brenda Fry. Brenda is a second year Communications student at Griffith University via Open Universities Australia. Read more about our internship program.