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Helping your child navigate their first tax return

By Greater Bank

A first job brings extra freedom for a teenager. Their first tax return often brings a few new questions, too.

You might suddenly find yourself explaining why tax comes out of their pay, what a tax file number is, or whether they actually need to lodge a tax return at all. For many young workers, it can feel unfamiliar or intimidating at first, especially when they’re navigating forms, payslips and new financial responsibilities for the first time.

While your child doesn’t need to become a tax expert overnight, understanding the basics early can help build confidence and healthy financial habits. A good place to start is by explaining that tax helps fund public services like hospitals, schools and roads, and that a tax return is simply a way of reporting how much income they earned during the financial year and how much tax has already been paid through their wages.

Going through that process together can help your child become more comfortable handling money, paperwork, and future financial decisions on their own. It doesn't have to be hard or boring, either. Here's how to approach it.

Do they need to lodge a tax return?

Does my child need to lodge a tax return?

As a rule of thumb, start with the income your child earned during the financial year. If they made money from part-time retail work, weekend café shifts, or casual holiday jobs, the Australian Tax Office (ATO) may require them to lodge.

What if they earned under the tax-free threshold?

They still might need to lodge if tax came out of their wages during the year. Lodging helps the ATO compare income earned with tax already withheld by an employer. For example, a 17-year-old working Saturday shifts at a supermarket may have tax taken from weekly pay, even with a fairly low yearly income. Submitting a tax return allows the ATO to check if too much tax came out and if your child is entitled to a refund.

Before starting, go through this checklist together. Your child will need:

  • Their tax file number (TFN)

  • Income statements through myGov or the ATO

  • Bank details

  • Receipts for eligible deductions

Getting these documents ready ahead of time cuts down delays, reduces last-minute stress, and gives younger workers a better understanding of how real-world money admin works.

Common terms explained

A few simple explanations can make tax language far less intimidating for a teenager completing a first return.

  • Tax return: A form sent to the ATO after the financial year. It lists income earned and tax already paid through wages.

  • Tax refund: Money returned after the ATO works out that too much tax came out during the year. A teenager working short holiday shifts or changing jobs during the year might receive part of that money back.

  • Tax withheld: Money an employer sends to the ATO from each pay cycle before wages reach your child’s bank account.

  • Deduction: Certain work-related expenses that can reduce taxable income. For example, a worker who buys approved uniform items for a job might qualify for a deduction.

  • Income threshold: The amount a person can earn before income tax rules change.

Using simple examples helps younger workers connect tax terms with real situations they already recognise from work.

What can they claim?

First-time workers might hear about tax deductions from friends, co-workers, or online videos. This gives you a good opportunity to explain that deductions only apply when an expense links directly with earning income.

For example, a teenager working in hospitality might buy non-slip shoes required for work. A retail worker might pay for approved uniform items. In some cases, those expenses could qualify as deductions.

Some expenses usually will not qualify, including:

  • Lunch bought during a work shift

  • Regular everyday clothing

  • Travel between home and work

Going through receipts together during a first tax return helps your child learn how to organise financial records early in adult working life. It also encourages honesty around claims and reduces the risk of mistakes later.

If you’re not sure about something, double-checking through the ATO or a registered tax agent is a good idea.

Where to get help

Your child won’t have every answer during a first tax return, and that’s completely normal. You can work through questions together and turn to trusted sources when needed.

Useful support includes:

For example, a teenager with two casual jobs during the same financial year might need extra help understanding tax withheld from each employer. Asking questions before lodging can help your child avoid incorrect information and delayed processing.

Getting a head start on financial well-being

A first tax return gives teenagers early exposure to wages, paperwork, deadlines, and government systems. Working through that process with your child can make later tax returns far less intimidating.

Small habits such as saving receipts, reading payslips, and checking income statements can also help young workers avoid confusion during future tax time.

You don’t need expert tax knowledge to guide these conversations. Patience, honest discussions, and reliable information from trusted sources can help your child develop money habits that will benefit them long into adult working life.

This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.

You should consider your own circumstances and seek advice from the Australian Taxation Office (ATO) or a registered tax agent if required.