This post is sponsored by Kids Business Communications
I have two teenagers, both at the age where they are working their first jobs and earning their first pay packets. With this comes paying tax (even if it’s only the tiniest of amounts at the start). These steps are their first into the world of being an adult and they need to learn about tax – how it works, what it’s used for and why we pay it. They also need to know how to lodge a tax return. So here are 5 things you should be teaching your kids about tax…
1- How to lodge a tax return
Being able to lodge your own tax return is Adulting 101. So, if your teens have a job they need to learn how to do a tax return. It’s easy to lodge a tax return through myTax, so show them the first time and there is no excuse for not knowing how to do this simple bit of adulting.
2- What their tax is used for
Your teenagers need to understand the importance of tax. It is the foundation of our society and they need to understand that our roads, infrastructure, education system, health care and everything else we take for granted only exists because of our strong tax system.
3- A robust tax system is necessary
The tax and super systems are crucial to the way of life we enjoy in Australia. We all have a role to play in ensuring that we support these systems and pay our fair share of tax. Your teenager may resent the idea of paying tax but the tax system is essential to provide services for the benefit of all Australians.
4- The importance of superannuation
Your 18-year-old probably can’t see the value of superannuation (super) just yet because they can’t even imagine being old enough to retire, but as parents we know how fast time goes. So, it’s really important that your teen is educated about what their super is for and how it will benefit them. It is predicted that millennials will rely on their super for more than 80% of their retirement fund, and that they will need over $1m in super for retirement. So, they need to start early!
5- How super works
It’s not enough just to know why we have super, for your teen to have a strong financial knowledge they need to understand how super works, the type of fund they are in and how their funds are being managed.
The more we teach our teens about tax and finance management, the better off they will be in the long run. It’s important to empower them early so that they can achieve financial freedom.
For more information on tax and super for your teen visit the ATO’s Tax Super and You website.