Job Hunting Tips for OZ

[Ash007]

Lots of good tips here. Not sure how many apply for Canada, but they seem quite applicable, regardless of the country.



I'm a bit confused by the point on company cars though. Why don't the sums add up?

Its novated leasing. Basically, you "pay" for the car pre-tax. When it was first introduced, the Fringe benefit tax was only around 15%, much less then the average income tax of around 20-30%. Hence, it was a big incentive to get novated leasing. Nowadays, the ATO has changed the tax law such that there is little to no benefit. FBT increased to around 20-30% depending on kilometers traveled per year.

http://www.orix.com.au/products-services/fleet-solutions/passenger-vehicles/novated-lease/FAQ.html

It was meant as a way to compensate businesses, sales, marketing person that needs to travel a lot. However, over the years, the government realized people have been abusing it and not paying tax for it.

 

[scroobal]

Typically one needs to reach at least 25K per year to realise the benefits of a novated leave. The higher the kilometres the greater the drop in fringe tax benefit that one has to shoulder.

The intent and purpose was to compensate people in the outlying areas and in remote locations as well as those who need to drive their vehicles for their work related duties daily.

Somehow people especially new migrants assume that its a company car as immediately treat it as perk and an honour. The number of times this has been mentioned in this forum is not a joke.

Its offered by employers as a supposed tax minimisation benefit but one has to do the sums. It also offered to any tom, dick and harry who is above a clerical grade.

The leasing agency will always tell you that leased vehicles have an immediate discount usually of $5K and no GST. What they don't tell you is that you can go to HR and get an annual discount voucher. Some employers provide at least 2 different vouchers for different brands. Its all in the HR welcome pack, but people don't bother to read.

I'm a bit confused by the point on company cars though. Why don't the sums add up?

 

[scroobal]

No worries bro. I think you missed my point. The first step is to clear the permanent job hurdle, then you can go for long term contract with the same company. All the Australian banks have long term contractors averaging more than 10 years with no problems. But they started as Permanent staff and got their credentials. .

The perm interview is not a technical interview. Its a character and management interview which is why it carries that much weight. The second part is the probation period followed by the yearly appraisal.

There is a huge difference between contractor's and permanent staff's interview.

A good contractor will have 80% of his work done in the same company for years.

One thing I will agree with you is that contractors tend to work much much harder and worth every penny and thats the reason why there is market for it. IT jobs are complex and one cannot have a deadbeat contributing to the elasped timeline. In fact, I can tell who is a permanent staff and contractor by the tone of the IT Head when he talks to them. The contractor will be the one abused. They also can be removed at a stroke of a pen or a phone call.

All I am saying is that if you new to a country go for a permanent job first to put it under your belt and get the network built , it will pay itself. That will get you in the front door of solid contracting work.

i beg to differ.

contract jobs are mainly for adhoc need or project basis and they are not meant to last for more than 2 years. However, some qld govt are hiring contractors almost like long term employees. can u imagine paying them $800/day for 9 years? they have to be more prudent in spending tax payer's money.

when it comes to interview for permament jobs in technical fields, the employers are usually less stringent, should the candidates fall short on certain areas and most likely, these gaps can be narrowed by trainings and coaching to bring the staffs up to par. Not so for contractors, we are tested rigorously for a specific technology and since most of the time, we are on project basis, there is no time for a person to take their own sweet time to familiarize with a technology or methodology to do the jobs. It is hard and fast, and employers tend to be alot more picky about our time and effort, plus they dont hold their tongue when it comes to critiques on our quality of works.

The contractors are working with their nose to the grinder, short lunch and straight back to work, not to mention we burn the weekends and nights to meet the deadline and system rollout. The money is there but so is the stress. my whole team of DBAs had checked into hospitals complaining of chest pains and anxiety attacks lately. one of the past project manager had died on the job years ago.

 

[axe168]

Wah I am interested in the discussion !

N
Salary Sacrifice
Don't commit to it unless you have done your sums. Those who are trained in economics will know this simple rule - "money now is more valuable than money later" Despite the lower taxation rate, the opportunity cost is usually too high. Its always better to get a bigger mortage and pay for it, then a smaller mortage and salary scarifice. The property and equity market always outstrips savings in the medium to long term.

I always smile, when I see a "hero" telling others about salary sacrifice. Its the usual problem of unable to work maths at multiple levels.

I totally agree ! however it may not be applicable, if ya about 50-55.. It is worth putting more money into Super @ 15% instead of say 46%.. and draw it out when 55.

Company or Novated Leased Car
Understandbly this always gets new migrants and some blur aussies. Typically this is offered to anyone who holds the position of supervisor and above. Unless you are travelling salesman or live out in boondocks and travel into the city daily, the sums do not add up.

As OZ is large continent, the tyranny of distance has to be compensated, or less no one wants to live outside the major cities or in rural towns.

You can tell a blur sotong straight away by asking where he stays and where he works. As the human tendency is never to to admit to a mistake, people will begin to drive to visit friends, sight seeing, drive holidays to chalk up the minimum miles to qualify for taxes benefits. The superkiasu will begin chalking mielage at the start of the tax year by handing the car to relative for excursion etc.

It may be worthwhile if you have a high tax bracket (say 46%).. why give half your earning to ATO if you can spend on some luxury for yourself ?

Negative Gearing
Might as well put this in as it usually part of the salary equation. I tend to notice that its the favourite discussion topics at Ah Soh / Ah Beng Gatherings. In a nutshell, one is supposed to reduce your taxable annual income if you incur a defeceit or loss in your investment property.

If under the current climate, if you are losing money on your investment property, it means either your rent is too low or you paid a too high a price for the property in the first place.

Negative gearing should never be part of long term financial planning. If it is, you must be out of your mind.

Negative gearing is a short term benefit.. In a normal property investment, it is highly unlikely to obtain immediate gain.. If you can find one, pls let me know asap ! Net profit should not be measured by rental income only.. it comes with capital gains.. less stamp, upkeep, insurance, council rates...

Property experts shld know how the land banking works.. They buy when the lands are cheap.... upkeep (and claim negative gearing rebate).. when the economical conditions are favourable... it is time to build, sell and achieve Capital Gain..

 

[scroobal]

1) Hate to tell you bro, most people in this discusion are in the 46% bracket.

2) If you are 50 and older, paying for a bigger property is still wiser. The day, you retire, you sell the bigger property, down grade to a manageable one and the rest can go into your retirement funds. Asians have the habit of thinking that the house must be a permanent fixture. A house is a basically a money making machine.

3) Here is a test that you can do on the quiet. Ask your colleagues if they do salary sacrifice and take note who does and who does not. Then you rate them against a smartness index. Guess which category will dominate the not so smart part of the index. They are also usually conservative, docile and non risk takers. No different to many singaporeans who put money in fixed deposit and stay in small HDB houses. Also an asian trait.

4) Unless you have to drive 25K each year, I have no arguments about novated leases. The good thing is that nearly all migrants will fall into this trap. I guess people will learn. By the way, ATO and you won't be earning but the Leasing company will. One good thing about novated leases is if you are totally broke and have no cash for downpayment as novated leases is 100% financed from start to end.

Wah I am interested in the discussion !

 

[axe168]

For all in the 46% bracket, they shld do more to claim rebates... or spend more for lifestyle (partially sponsored by the govt)... ie next year I might even opt for 4weeks unpaid +4 weeks annual for quality time and better tax benefits.

I've seen some with stable incomes choose to secure the money in the bank / pay off mortgage during crisis.. some live simple life, & have more kids and enjoy centrelink benefits (while collecting rent in SG).. few place more bets during crisis due to good appetite fo risks..

We can't have winners all the time.... Aiyo whatever you do as long as the path benefits you.. then do it.. You have a Choice in Australia.

1) Hate to tell you bro, most people in this discusion are in the 46% bracket.

2) If you are 50 and older, paying for a bigger property is still wiser. The day, you retire, you sell the bigger property, down grade to a manageable one and the rest can go into your retirement funds. Asians have the habit of thinking that the house must be a permanent fixture. A house is a basically a money making machine.

3) Here is a test that you can do on the quiet. Ask your colleagues if they do salary sacrifice and take note who does and who does not. Then you rate them against a smartness index. Guess which category will dominate the not so smart part of the index. They are also usually conservative, docile and non risk takers. No different to many singaporeans who put money in fixed deposit and stay in small HDB houses. Also an asian trait.

4) Unless you have to drive 25K each year, I have no arguments about novated leases. The good thing is that nearly all migrants will fall into this trap. I guess people will learn. By the way, ATO and you won't be earning but the Leasing company will. One good thing about novated leases is if you are totally broke and have no cash for downpayment as novated leases is 100% financed from start to end.

 

[Ash007]

For all in the 46% bracket, they shld do more to claim rebates... or spend more for lifestyle (partially sponsored by the govt)... ie next year I might even opt for 4weeks unpaid +4 weeks annual for quality time and better tax benefits.

I've seen some with stable incomes choose to secure the money in the bank / pay off mortgage during crisis.. some live simple life, & have more kids and enjoy centrelink benefits (while collecting rent in SG).. few place more bets during crisis due to good appetite fo risks..

We can't have winners all the time.... Aiyo whatever you do as long as the path benefits you.. then do it.. You have a Choice in Australia.

Na beh, I'm not in the 46% brackets, you guys make me jealous only. But I agree, different people wants different lifestyle with different priorities. I don't know what you guys think about Singapore, but in my opinion Singapore seem to offer only one lifestyle. I suppose this is what is called "freedom" do what you want in life. I'm loving it everyday here no matter what the trolls may say.

 

[IWC2006]

No worries bro. I think you missed my point. The first step is to clear the permanent job hurdle, then you can go for long term contract with the same company. All the Australian banks have long term contractors averaging more than 10 years with no problems. But they started as Permanent staff and got their credentials. .

The perm interview is not a technical interview. Its a character and management interview which is why it carries that much weight. The second part is the probation period followed by the yearly appraisal.

There is a huge difference between contractor's and permanent staff's interview.

A good contractor will have 80% of his work done in the same company for years.

One thing I will agree with you is that contractors tend to work much much harder and worth every penny and thats the reason why there is market for it. IT jobs are complex and one cannot have a deadbeat contributing to the elasped timeline. In fact, I can tell who is a permanent staff and contractor by the tone of the IT Head when he talks to them. The contractor will be the one abused. They also can be removed at a stroke of a pen or a phone call.

All I am saying is that if you new to a country go for a permanent job first to put it under your belt and get the network built , it will pay itself. That will get you in the front door of solid contracting work.

Rubbish, I work for a bank here in Sydney.

Perm staff selection critieria is definitely more stringent - one must go thru 2 reference checks + pyschometric test and additional interview, for contract staff just one reference check and no test. In some cases, contract staff are hired for specific skillsets can't find in their permanent pool thus of course the selection criteria is very specific.

Is there any differentiation a contract staff has to work harder then a perm staff? I don't think so, both have to work hard. Perm staff work hard to get a good appraisal and opportunity for career advancement/promotion. Contract staff work hard to let their employer know they are worthy every single penny and their contracts get renewed. The only risk is if the contract staff is underperformed or staff reduction, they will be the first one to go.

There is no neccessity to start as a perm staff then convert to a contract staff. Its a matter of individual preference, some people prefer perm but the job offer is project specific thus only contract jobs are available. Some prefer the premium of being a contractor and flexibility to move around. As long you prove your cents worth, contractor or perm can land jobs easily. There could be instances contractors being doing contracting for long time then decided to be come perm , but employer may suspect his loyalty because of economy dowturn thats why the candiate chose to become a perm. There is no easy answer, but if your skills are in high demand - whether perm or contractors are irrelevant.

 

[scroobal]

Please read the post properly.

Commonsense will tell you that permanent staff interview obviously is more stringent than contractor. Besides competency they have character and management components. You can sack a contractor on the spot so why bother with the rest except for technical competency.

Rubbish, I work for a bank here in Sydney.

Perm staff selection critieria is definitely more stringent - one must go thru 2 reference checks + pyschometric test and additional interview, for contract staff just one reference check and no test. In some cases, contract staff are hired for specific skillsets can't find in their permanent pool thus of course the selection criteria is very specific.

Is there any differentiation a contract staff has to work harder then a perm staff? I don't think so, both have to work hard. Perm staff work hard to get a good appraisal and opportunity for career advancement/promotion. Contract staff work hard to let their employer know they are worthy every single penny and their contracts get renewed. The only risk is if the contract staff is underperformed or staff reduction, they will be the first one to go.

There is no neccessity to start as a perm staff then convert to a contract staff. Its a matter of individual preference, some people prefer perm but the job offer is project specific thus only contract jobs are available. Some prefer the premium of being a contractor and flexibility to move around. As long you prove your cents worth, contractor or perm can land jobs easily. There could be instances contractors being doing contracting for long time then decided to be come perm , but employer may suspect his loyalty because of economy dowturn thats why the candiate chose to become a perm. There is no easy answer, but if your skills are in high demand - whether perm or contractors are irrelevant.

 

[scroobal]

Obviously one has to take advantage of taxes. Only an idiot will not minimise taxes. The worst situation is thinking that you are minmising taxes when you are actually making a bigger loss.

Its a human trait that hard to get rid of. Thats why discount cards are still popular. Instead of patronising places that are good and things that you need, one modifies their spending to get the "rewards"

For all in the 46% bracket, they shld do more to claim rebates... or spend more for lifestyle (partially sponsored by the govt)... ie next year I might even opt for 4weeks unpaid +4 weeks annual for quality time and better tax benefits.

I've seen some with stable incomes choose to secure the money in the bank / pay off mortgage during crisis.. some live simple life, & have more kids and enjoy centrelink benefits (while collecting rent in SG).. few place more bets during crisis due to good appetite fo risks..

We can't have winners all the time.... Aiyo whatever you do as long as the path benefits you.. then do it.. You have a Choice in Australia.

 

[neddy]

Obviously one has to take advantage of taxes. Only an idiot will not minimise taxes. The worst situation is thinking that you are minmising taxes when you are actually making a bigger loss.

Its a human trait that hard to get rid of. Thats why discount cards are still popular. Instead of patronising places that are good and things that you need, one modifies their spending to get the "rewards"

I am waiting for Dr Ken Henry's Tax Reform.
It may take decades to implement, but I will be interested to know how it will affect the family home, CGT, depreciation on investment properties, etc.

 

[Rafael Vandervaart]

Interesting thread guys..
Thanks a mil...
Will take steps to avoid pitfalls mentioned..


Btw i'm one step closer to my dream of heading there....
Got my ielts done successfully..

 

[neddy]

Now that you have been offerred a job, what next?

....

Negative Gearing
Might as well put this in as it usually part of the salary equation. I tend to notice that its the favourite discussion topics at Ah Soh / Ah Beng Gatherings. In a nutshell, one is supposed to reduce your taxable annual income if you incur a defeceit or loss in your investment property.

If under the current climate, if you are losing money on your investment property, it means either your rent is too low or you paid a too high a price for the property in the first place.

Negative gearing should never be part of long term financial planning. If it is, you must be out of your mind.

how about positive gearing with tax reduction thru' franking credits in this financial climate?

 

[scroobal]

Smart man.

Negative gearing is the best satefy net just in case OZ heads back to the 80s era when interest rate were double digit.

how about positive gearing with tax reduction thru' franking credits in this financial climate?

 

[scroobal]

The best reform is allow interest rate for 1st home mortages to be tax deductible like the US but I doubt it will happen. It will certainly help people to invest more in their first home and allow it to form part of the nest egg.

After GFC and the lambasting that Peter Costello got for the salary sacrifice, I am sure this component will start eroding.

I am waiting for Dr Ken Henry's Tax Reform.
It may take decades to implement, but I will be interested to know how it will affect the family home, CGT, depreciation on investment properties, etc.

 

[scroobal]

Good on you. You are one of the rare few chaps in the forum that is doing things towards your goals and asking clarification at the same time. With an attitude like that, you will have no problem settling down.

Interesting thread guys..
Thanks a mil...
Will take steps to avoid pitfalls mentioned..


Btw i'm one step closer to my dream of heading there....
Got my ielts done successfully..

 

[scroobal]

Don't worry, you will reach it very quickly.

Na beh, I'm not in the 46% brackets, you guys make me jealous only. But I agree, different people wants different lifestyle with different priorities. I don't know what you guys think about Singapore, but in my opinion Singapore seem to offer only one lifestyle. I suppose this is what is called "freedom" do what you want in life. I'm loving it everyday here no matter what the trolls may say.

 

[kiketerm]

Interesting thread guys..
Thanks a mil...
Will take steps to avoid pitfalls mentioned..


Btw i'm one step closer to my dream of heading there....
Got my ielts done successfully..

Why do you wan to go down under to pay off those socialist tax carbon tax consumption tax income tax water tax car tax house tax alcohol tax cigarette tax

Dun you know the Tax office will take almost 50% of your pay from your paycheck so you really working for garhment plus all those old timer pension now is collecting your 50% tax withhold from paycheck and all the ang moh bum who collect DOLE there is sitting at street corner drunk all day from your 50% wage

You crazy or what?

 

[axe168]

Na beh, I'm not in the 46% brackets, you guys make me jealous only. But I agree, different people wants different lifestyle with different priorities. I don't know what you guys think about Singapore, but in my opinion Singapore seem to offer only one lifestyle. I suppose this is what is called "freedom" do what you want in life. I'm loving it everyday here no matter what the trolls may say.

Tell you a joke I had yesterday.. I was busy chitchatting with my frz (M'sian SG PR) yesterday over the phone.. (both are perm stafff).. when the clock strikes 5pm.. he stopped the interesting conversation and said it is time to go home.. Australian Culture lah.. LOL !! Na beh.. like tat also can !! wahahaha..

In Australia, we go after "happiness".. "relaxation".. and "family bond".. Enjoy your lifestyle in Australia while you can.. coz life is too short..

 

[axe168]

The best reform is allow interest rate for 1st home mortages to be tax deductible like the US but I doubt it will happen. It will certainly help people to invest more in their first home and allow it to form part of the nest egg.

After GFC and the lambasting that Peter Costello got for the salary sacrifice, I am sure this component will start eroding.

It sounds simple.. but it aint. All tax deductible components will be paid back to ATO eventually. It is wise not to alert them.. and enjoy your cake discreetly ~ ie we can learn from those Viet or Chinamen rented out their ppty to 20 students.. keke.

1st home as 'primary hse' is tax free.. If it is tax deductible ~ you are declaring it as 'investment' claiming $$$.. it will be subjected to CPT when you sell your hse..