Jacob Fenech

in each state within Australia.

And it's pretty applicable for, say, anyone that's an employee, definitely, but sole traders, contractors, anyone with tax basically within that space.

Yeah, it's always an important question because it's never nice having tax taken from you, so you want to know what it is and where it's going.

So basically, people are – tax is cash effectively collected on behalf of the government, so it goes towards public goods.

A lot of the listeners would definitely know, at least have some background, but whether it's health, whether it's education, defence, that's where your tax is going, road and railways even.

So it's going to fund that.

Usually you're paying tax definitely if you're a business and you're in a positive cash flow position, which we'll come back to.

So you'd be paying tax.

If you're an employee, you're earning salary and wages, you're likely paying tax.

if you're even sometimes if you're receiving say Centrelink payments although they're government payments you're still potentially paying tax on those as well and then the final one probably that we see as well outside of small businesses is investment income so if you're someone that's got whether it be like trust distributions dividends bank interest whatever it might be you're likely at least paying depending on

kind of certain thresholds as well, but paying some sort of tax on those.

So it's usually relevant to a huge broad spectrum of people and, yeah, hopefully you've come to terms with paying tax because it's probably something that you'll do for a while anyway.

I think it's a really good question.

So it varies definitely, say, for people that are new to Australia.

Australia, it's a really good tax system in a sense of withholdings and things which I'll chat about, but it's definitely different to other countries.

So like you said, growing up, we used to say part of tax in Australia is PAYG or pay-as-you-go system, which is, say, very similar to a –

US system or a New Zealand system as well, where basically you've got your gross income that you're receiving.

So it's your total income from your employer.

And we're talking about, say, employees at the moment.

you receive your gross income and then in your payslip, you can see that each time you're paid, you're actually losing a bit of your money and that's tax that's going that the company is actually withholding on your behalf that goes towards your year-end tax bill, I suppose.