If this was correct, a person earning $85,000 would take home $51,000, and a person earning $75,000 would take home $52,500. Why on earth would anyone accept a salary in between those two figures? I’ll tell you why. Because that’s not how the system works.


So, how much tax do you really pay? Simplified, your tax payable is equal to income tax minus deductions. Deductions are an individual thing, based on assets, income, dependents, all kinds of things. I’m not going to go into that here. But I will show you how to calculate your income tax.

First of all, you need to understand that your income gets divided up into brackets and each bracket is assigned a tax rate. In Australia, the lowest tax bracket is $0 to $6000, upon which you are not taxed at all. The next bracket starts at $6,001 and goes up to $34,000. This bracket carries a tax of 15%. The last three brackets of $34,001 – $80,000, $80,001 – $180,000 and $180001+ carry taxes of 30%, 40% and 45% respectively.

To calculate your tax, you start with your total gross income. Up to the first $6,000 you’ll pay no tax. For every dollar above $6,000 up to $34,000 you’ll pay just 15% on. Did your income exceed $34,000? By how much? Between $34,001 and $80,000, you’ll have to pay 30%. And so on, and so forth. Money within a bracket is only ever taxed at that bracket’s rate.

I’ve taken the liberty to produce a simple Excel spreadsheet to calculate income tax in Australia. You can download it here. Just enter your taxable income in the top left box and the spreadsheet will tell you how much tax you’re paying inside each bracket. There is a total in the bottom right.

I’ve also included an Effective Rate box. The Effective Rate is is the average rate of tax you’re paying per dollar. For people whose income is reasonably steady, this should give you a far better idea of how much of your weekly paycheck you will have to give up as tax.

I leave it to the reader to figure out their own deductions, payable levies and the like.

First of all, you need a table of data. Here’s one I’ve prepared, showing Quantity, Total Cost, Average Total Cost, Average Variable Cost and Marginal Cost:-



And this is what ATC, AVC and MC would look like in a graph:-



Except that’s wrong, because the MC line should start a half-tick to the left of the other data lines. So, how do we do this? The first step is to add another column to our graph. I’m going to call it MCx. I’m then going to fill it with the x-axis values for each corresponding MC value. (For large amounts of data, you can usually make this faster by observing that it’ll be the same as “Quantity – .5″.)



Now, here comes the tricky part – applying the custom x-values to the MC curve without affecting the other data. The first step is to change the type of graph you’re dealing with. You don’t actually want a “line graph” anymore. What you want is an “X Y (Scatter)”, specifically Scatter with Smooth Lines. You can see the graph type you need in the image below.



Colours notwithstanding, it looks pretty much like the last graph. Scatter plots have one major advantage though – you can select a custom x-axis for each set of data! So whilst the ATC and AVC lines will get their x-axis values from the Q column, we can change the MC line to use the MCx column for its x-axis values. To do this, right-click the graph and go to “Select Data”. Highlight “MC” and click “Edit”.



Now you can set the x-axis values to the column we created earlier. All you need to do is delete everything in the “Series X values” box, and replace it with your own data, in this case everything from F2 to F9.



Press OK a couple of times to get out of those menus and your graph will now show the MC line shifted half a tick to the left – where it’s supposed to be. Technically this trick can be applied to give ANY data offset values on an axis. The secret really lies in using an X Y Scatter plot.