Could you adequately answer if your child asked what tax is or why we need to pay superannuation?
I know that I could provide my kids with a broad explanation… “Paying tax helps pay for our roads”. Or “you need money from superannuation when you are old and can no longer work”. But the truth is I’m not confident that I could teach my children about taxation and superannuation processes. I couldn’t explain to my children, how superannuation is calculated or how to complete a tax return.
Yes, schools have a responsibility to teach our children mathematics and introduce the idea of tax and super. But the Australian curriculum is already so full. And our teachers do not have the man hours available to allow our kids to deeply study the subject. It is our responsibility as mums and dads to prepare our babies so that they are ready for the financial world.
I sat down with my daughter and asked her what she thought tax is… She said, “it’s money you and daddy throw away”. After a little laugh, I realised that she came to that description from overhearing her dad and I talking. She only hears us complain about paying tax. She doesn’t hear where our tax money goes, once we ‘throw it away’.
This week both my kids have been home sick with ear and chest infections and had been prescribed antibiotics. This was an opportunity to explain a bit about the Pharmaceutical Benefits Scheme. I explained that if mummy and daddy didn’t pay tax, her medicine would be like a million dollars, instead of $5.70. She then wanted to go through our WHOLE medicine cabinet and ask how much each item would’ve been if we didn’t pay tax! So as boring as tax seems, there are ways we can discuss it with our kids in engaging ways.
Want to raise a conversation about tax and super with your kids?
Click here for a helpful fact sheet.
I recently learnt that The Australian Taxation Office (ATO) has created a number of free, online educational resources. These resources are available for parents, school-aged children and their teachers to assist kids with learning about taxation and superannuation.
‘Tax, Super and You‘ has been created to assist kids with learning about taxation and superannuation. It features online courses, a glossary of terms, fun facts and heaps more. The site itself has a fun design, is interactive and provides age-appropriate information on real life tax topics. Such as calculating tax due and completing your tax return.
In addition to ‘Tax, Super and You’ the ATO website is a fantastic resource for specialised taxation and superannuation information. It provides all the tax related information, calculators, fact sheets and forms you could possibly desire! The website also has a live chat function available. This allows you to speak with an ATO staff member directly if you need further clarification on a topic, specialised help with a problem or if you need help being directed to a particular area of the website.
How will you introduce you kids to the world of superannuation and taxation, let me know in the comments?