Kalaro Guides · Tax Returns
Individual, Company and Trust Tax Returns
Three different entities, three different rulebooks. This is what actually changes between them, when each return falls due, and where people most often get caught out.
Individual tax returns
Every Australian resident who earns above the tax-free threshold, has tax withheld from wages, or has reportable income from investments, side work or capital gains generally needs to lodge an individual tax return. The return reconciles what's been withheld through the year against what's actually owed.
For the 2026-27 financial year, resident individual tax rates are:
| Taxable income | Tax rate |
|---|---|
| $0 to $18,200 | Nil |
| $18,201 to $45,000 | 15% |
| $45,001 to $135,000 | 30% |
| $135,001 to $190,000 | 37% |
| $190,001 and over | 45% |
On top of this, most residents pay a 2% Medicare levy, and the Low Income Tax Offset reduces the effective tax-free threshold to around $22,800 for many low-income earners. If you have a HELP debt, repayments are calculated separately on top of your income tax.
If you lodge your own return, it's due 31 October following the end of the financial year. Lodging through a registered tax agent generally extends this well into the following year, often to May, provided you're registered with that agent before 31 October.
Company tax returns
A company is a separate legal entity, so it lodges its own return and pays tax on its profit regardless of whether that profit is distributed to shareholders. Two rates apply depending on the company's size and income mix:
- 25%: the base rate, for "base rate entities". Companies with aggregated turnover under $50 million where no more than 80% of assessable income is passive (interest, rent, dividends, royalties and similar).
- 30%: the standard rate, for all other companies.
Tax paid by the company generates franking credits, which flow through to shareholders when profits are distributed as dividends. This is what prevents the same dollar of profit being taxed twice, once in the company and again in the shareholder's hands.
Company return due dates depend on your lodgment history and whether you use a tax agent, commonly 28 February for large or new entities, or 15 May for most companies lodging through an agent. Payment dates can differ from lodgment dates, so check both.
Trust tax returns
Trusts are usually "flow-through" vehicles. The trust itself lodges a return, but tax is generally paid by whoever is presently entitled to the income, not by the trust. Where a beneficiary is presently entitled and has received a distribution, that income is taxed in their hands at their own marginal rate.
This makes the trustee's distribution resolution the most important document in the whole process. If a valid resolution isn't made and documented by the required date, 30 June for most discretionary trusts, the default position can see the trustee taxed at the top marginal rate on undistributed income, which is rarely the intended outcome.
Distributions made to a company beneficiary that aren't actually paid can create an unpaid present entitlement (UPE). Left unmanaged, a UPE can be treated as a deemed dividend under Division 7A, triggering an unexpected tax bill. This is one of the most common issues we see when picking up a trust from a previous accountant.
How the three compare
| Entity | Who pays tax | Key deadline |
|---|---|---|
| Individual | The individual, on all income | 31 Oct (self-lodge) |
| Company | The company, at 25% or 30% | Varies (28 Feb / 15 May) |
| Trust | Beneficiaries (or trustee by default) | 30 Jun (resolution) |
Frequently asked questions
Often yes. If any tax was withheld from your pay during the year, you generally still need to lodge to claim that back, even if your total income is under $18,200. A registered tax agent can confirm whether a non-lodgment advice is appropriate instead.
Yes, but the tax consequence is usually less favourable. Undistributed trust income is generally taxed to the trustee at the top marginal rate, with no access to the beneficiary's own lower rate or offsets.
Companies with aggregated turnover of $50 million or more, or where more than 80% of assessable income is passive income, don't qualify as base rate entities and pay tax at the standard 30% rate.
This guide reflects Australian tax settings for the 2026-27 financial year and is general information only. It doesn't take into account your personal circumstances and shouldn't be relied on as tax advice. Rates, thresholds and lodgment dates are set by the ATO and can change; always confirm current figures before lodging.