Calculate Your Income Tax Australia

Calculate your exact tax liability including Medicare levy and offsets. Updated for 2023-24 financial year.

Expert Verified

This guide is maintained by certified tax professionals and updated monthly with the latest ATO rulings. All calculations comply with Australian Taxation Office guidelines.

Module A: Introduction & Importance of Accurate Tax Calculation

The Australian income tax system operates on a progressive scale, meaning your tax rate increases as your income rises. This calculator provides precise estimates by incorporating:

• Residency status (different rates for residents vs foreign residents)
• Medicare levy (2% of taxable income, with exemptions available)
• HECS/HELP repayments (1-10% of income depending on your repayment threshold)
• Low and middle income tax offset (LMITO) where applicable
• Private health insurance rebates that may reduce your Medicare levy

According to the Australian Bureau of Statistics, the average Australian pays approximately 22.5% of their income in taxes when combining income tax and Medicare levy. However, this varies significantly based on income level and personal circumstances.

Accurate tax calculation helps with:

1. Financial planning and budgeting
2. Avoiding unexpected tax bills
3. Optimizing your tax position through legitimate deductions
4. Understanding your take-home pay when negotiating salaries
5. Planning for major financial decisions like property purchases

Module B: Step-by-Step Guide to Using This Calculator

Pro Tip

For most accurate results, use your taxable income (gross income minus deductions) rather than your gross salary. You can find this on your payment summary or last tax return.

1. Enter Your Taxable Income

   Input your annual taxable income in Australian dollars. This should be your income after all deductions but before any taxes are applied. For salary earners, this is typically your gross salary minus any work-related expenses you claim.

2. Select Your Residency Status

   Choose whether you’re an Australian resident for tax purposes or a foreign resident. This significantly affects your tax rates:

   • Residents enjoy a tax-free threshold ($18,200) and lower rates
   • Foreign residents pay tax on every dollar earned (no tax-free threshold) and cannot claim the tax-free threshold or certain offsets

3. Indicate HECS/HELP Debt Status

   Select whether you have an outstanding HECS/HELP debt. If you do, the calculator will include compulsory repayments which range from 1% to 10% of your income depending on your repayment income.

4. Private Health Insurance Status

   Indicate whether you have private hospital cover. This affects:

   • Your Medicare Levy Surcharge (MLS) if your income exceeds $93,000 (single) or $186,000 (family)
   • Potential rebates on your private health insurance premiums

5. Select the Income Year

   Choose the financial year for which you’re calculating tax. The calculator includes historical tax rates back to 2021-22 for comparison purposes.

6. Review Your Results

   The calculator will display:

   • Your income tax liability
   • Medicare levy amount
   • Any HECS/HELP repayments
   • Your net income after all taxes
   • Your effective tax rate
   • A visual breakdown of where your tax dollars go

7. Use the Visual Chart

   The interactive chart shows how your income is allocated across:

   • Take-home pay (blue)
   • Income tax (red)
   • Medicare levy (green)
   • HECS repayments (purple, if applicable)

Module C: Formula & Methodology Behind the Calculations

Our calculator uses the exact formulas published by the Australian Taxation Office (ATO) with the following methodology:

1. Income Tax Calculation

For Australian residents (2023-24 financial year):

Taxable Income	Tax Rate	Tax on This Bracket
$0 – $18,200	0%	$0
$18,201 – $45,000	19%	19c for each $1 over $18,200
$45,001 – $120,000	32.5%	$5,092 plus 32.5c for each $1 over $45,000
$120,001 – $180,000	37%	$29,467 plus 37c for each $1 over $120,000
$180,001 and over	45%	$51,667 plus 45c for each $1 over $180,000

For foreign residents, the tax-free threshold doesn’t apply, and rates start at 32.5% from the first dollar.

2. Medicare Levy Calculation

The standard Medicare levy is 2% of taxable income, however:

• Low-income earners may qualify for a reduction or exemption
• Those without private hospital cover and income over $93,000 (single) or $186,000 (family) pay an additional Medicare Levy Surcharge (MLS) of 1-1.5%
• The levy is capped at 10% of your taxable income if you have multiple Medicare levy surcharge years

3. HECS/HELP Repayment Calculation

Repayments are calculated as a percentage of your repayment income (which includes taxable income plus certain other amounts):

Repayment Income	Repayment Rate
Below $51,550	0%
$51,550 – $58,255	1%
$58,256 – $64,962	2%
$64,963 – $73,618	3%
$73,619 – $82,273	4%
$82,274 – $92,879	4.5%
$92,880 – $103,482	5%
$103,483 – $116,035	5.5%
$116,036 – $133,288	6%
$133,289 – $150,540	7%
$150,541 – $172,492	7.5%
$172,493 – $194,444	8%
$194,445 and above	10%

4. Tax Offsets

The calculator automatically applies the Low and Middle Income Tax Offset (LMITO) where applicable:

• Maximum offset of $1,500 for taxable incomes between $48,000 and $90,000
• Phases out completely at $126,000
• For 2023-24, the offset is calculated as:
  (($1,500 - (($taxable_income - $48,000) × 0.03)) if $48,000 < $taxable_income ≤ $90,000 else $1,500)

5. Effective Tax Rate Calculation

The effective tax rate is calculated as:

(Total Tax + Medicare Levy + HECS Repayment) ÷ Taxable Income × 100

This gives you the actual percentage of your income that goes to taxes and related obligations.

Module D: Real-World Case Studies

Note

All case studies use 2023-24 tax rates and assume the individual is an Australian resident with private health insurance (no MLS).

Case Study 1: Early Career Professional

Profile: Emma, 25, Marketing Coordinator
Taxable Income: $65,000
HECS Debt: Yes ($30,000 remaining)
Private Health: Yes

Calculation Breakdown:

• Income Tax: $11,047
  • $5,092 (tax on first $45,000 at 19%)
  • $5,955 (32.5% on $18,000 between $45,001-$63,000)
  • $0 (remaining $2,000 at 32.5% = $650, but offset by LMITO)
• LMITO Applied: $1,500 (full offset)
• Medicare Levy: $1,300 (2% of $65,000)
• HECS Repayment: $1,950 (3% of $65,000)
• Net Income: $50,703
• Effective Tax Rate: 21.99%

Key Insight: Emma benefits significantly from the LMITO, which reduces her tax by $1,500. Her HECS repayment is relatively low at 3% because she's in the lower repayment threshold.

Case Study 2: Mid-Career Family Provider

Profile: James, 38, Senior Engineer
Taxable Income: $110,000
HECS Debt: No (paid off)
Private Health: Yes (family cover)

Calculation Breakdown:

• Income Tax: $24,117
  • $5,092 (tax on first $45,000)
  • $24,375 (32.5% on $75,000 between $45,001-$120,000)
  • $0 (remaining $10,000 at 37% = $3,700, but partially offset by LMITO)
• LMITO Applied: $675 (partial offset)
• Medicare Levy: $2,200 (2% of $110,000)
• HECS Repayment: $0
• Net Income: $83,008
• Effective Tax Rate: 24.54%

Key Insight: James is in the 37% tax bracket for the portion of his income over $120,000. His LMITO is reduced because his income exceeds $90,000 where the full offset phases out.

Case Study 3: High-Income Executive

Profile: Sarah, 45, Corporate Lawyer
Taxable Income: $220,000
HECS Debt: No
Private Health: Yes (top hospital cover)

Calculation Breakdown:

• Income Tax: $67,167
  • $5,092 (tax on first $45,000)
  • $24,375 (32.5% on $75,000 between $45,001-$120,000)
  • $14,800 (37% on $60,000 between $120,001-$180,000)
  • $22,900 (45% on $40,000 over $180,000)
• LMITO Applied: $0 (income exceeds $126,000)
• Medicare Levy: $4,400 (2% of $220,000)
• HECS Repayment: $0
• Net Income: $148,433
• Effective Tax Rate: 32.57%

Key Insight: Sarah pays the top marginal tax rate of 45% on income over $180,000. She receives no LMITO and her effective tax rate approaches one-third of her income. However, her net income of $148,433 still places her in the top 5% of Australian earners.

Module E: Australian Tax Data & Statistics

1. Tax Bracket Distribution (2022-23 ATO Data)

Taxable Income Range	Number of Taxpayers	% of Total Taxpayers	Avg Tax Paid	Avg Effective Rate
$0 - $18,200	2,145,320	14.6%	$0	0%
$18,201 - $45,000	3,876,540	26.4%	$2,876	10.3%
$45,001 - $90,000	4,231,780	28.8%	$10,450	17.2%
$90,001 - $180,000	3,124,870	21.3%	$28,765	23.4%
$180,001+	1,256,490	8.6%	$78,430	31.2%
Total	14,635,000	100%	$18,450	19.8%

Source: ATO Taxation Statistics 2022-23

2. State-by-State Average Taxable Income (2022-23)

State/Territory	Avg Taxable Income	Avg Tax Paid	Avg Effective Rate	% with HECS Debt
New South Wales	$72,340	$14,870	20.6%	28.4%
Victoria	$69,870	$14,230	20.4%	29.1%
Queensland	$68,450	$13,840	20.2%	27.8%
Western Australia	$78,920	$17,230	21.8%	25.3%
South Australia	$65,210	$13,040	20.0%	28.7%
Tasmania	$60,180	$11,680	19.4%	30.2%
Australian Capital Territory	$85,670	$19,450	22.7%	32.5%
Northern Territory	$76,320	$16,340	21.4%	26.9%
National Average	$70,120	$14,320	20.4%	28.3%

Source: ABS Average Weekly Earnings

3. Historical Tax Rates Comparison

The top marginal tax rate in Australia has fluctuated significantly over time:

• 1980s: Top rate of 60% on income over $35,700
• 1990s: Reduced to 47% on income over $50,000
• 2000s: Top rate of 45% introduced on income over $180,000
• 2024: Stage 3 tax cuts (effective 1 July 2024) will flatten the 32.5% and 37% brackets to a single 30% rate for incomes between $45,000 and $200,000

These changes reflect shifting economic policies, with recent reforms aiming to simplify the tax system and address bracket creep (where inflation pushes workers into higher tax brackets without real income increases).

Module F: Expert Tax Optimization Tips

Important Note

Always consult with a registered tax agent before implementing complex tax strategies. The following tips are general advice only.

1. Maximizing Deductions

• Work-related expenses: Keep receipts for uniforms, tools, home office equipment, professional development courses, and union fees. The ATO allows immediate deductions for items under $300 that are directly related to earning your income.
• Home office expenses: If working from home, you can claim:
  • 80 cents per hour for all expenses (simplified method)
  • Or actual expenses (calculate the work-related portion of phone, internet, electricity, and depreciation on equipment)
• Vehicle expenses: For work-related travel (not commuting), you can claim:
  • 78 cents per km (up to 5,000km) using the cents-per-km method
  • Or actual expenses using the logbook method (requires 12-week logbook)
• Self-education: Courses that maintain or improve skills in your current occupation are deductible, including:
  • Course fees
  • Textbooks and stationery
  • Travel to/from place of education
  • Depreciation on equipment like laptops

2. Strategic Income Timing

1. Income deferral: If you expect to earn less next financial year (e.g., due to maternity leave or career break), consider deferring income (like bonuses) to the lower-income year.
2. Bring forward deductions: Pre-pay expenses before 30 June to claim them in the current financial year. This works well for:
   • Income protection insurance premiums
   • Work-related subscriptions
   • Charitable donations
   • Investment property repairs
3. Capital gains timing: If you've realized capital gains, consider selling some loss-making investments to offset the gains.
4. Superannuation contributions: Salary sacrifice additional super contributions to reduce your taxable income (concessional contributions cap is $27,500 for 2023-24).

3. Superannuation Strategies

• Concessional contributions: Contribute up to $27,500 (2023-24 cap) at 15% tax rate instead of your marginal rate. This is particularly valuable if you're in the 32.5%+ tax bracket.
• Spouse contributions: If your spouse earns less than $37,000, you can contribute to their super and claim an 18% tax offset (up to $540).
• Government co-contribution: If you earn less than $58,445 and make after-tax super contributions, the government may contribute up to $500.
• First Home Super Saver Scheme: Save for your first home through superannuation, allowing you to withdraw voluntary contributions (up to $15,000 per year, $50,000 total) for a home deposit.

4. Medicare Levy Strategies

• Private health insurance: If your income exceeds $93,000 (single) or $186,000 (family), private hospital cover avoids the 1-1.5% Medicare Levy Surcharge.
• Low-income exemptions: If your taxable income is below $24,276 (single) or $40,939 (family), you may qualify for a Medicare levy exemption or reduction.
• Dependent exemptions: You may qualify for a Medicare levy reduction if you have dependents in full-time education.

5. HECS/HELP Repayment Optimization

• Voluntary repayments: You can make voluntary repayments of $500 or more to reduce your debt faster. These receive a 5% bonus (e.g., $500 repayment reduces debt by $525).
• Overseas repayments: If you're working overseas, you must make compulsory repayments if your worldwide income exceeds the minimum repayment threshold ($51,550 for 2023-24).
• Indexation awareness: HECS debts are indexed to CPI on 1 June each year. In 2023, the indexation rate was 7.1% - the highest in decades. Consider making voluntary repayments before indexation if you have spare funds.

6. Small Business Considerations

• Instant asset write-off: Businesses with turnover under $10 million can immediately deduct the full cost of eligible assets costing less than $20,000 (as of 2023-24).
• Home-based business deductions: Claim a portion of home expenses (rent/mortgage interest, rates, electricity) based on the floor area used for business.
• Prepaid expenses: Small businesses can claim immediate deductions for prepaid expenses (like insurance or rent) that cover a period of 12 months or less.
• Company structure: For higher earners, operating through a company may provide tax advantages, with the company tax rate at 25% (for base rate entities) or 30%.

Module G: Interactive FAQ

How does the Australian tax system compare to other countries?

Australia's tax system is considered progressive but middle-of-the-road compared to other developed nations:

• Top marginal rate: Australia's 45% top rate (including Medicare levy) is lower than many European countries (e.g., Denmark 55.9%, France 55.4%) but higher than the US (37%) and UK (45%).
• Tax-free threshold: Australia's $18,200 tax-free threshold is relatively generous compared to countries like New Zealand ($14,000) but less than the UK (£12,570 ≈ AUD $24,000).
• Capital gains tax: Australia includes a 50% discount for assets held over 12 months, which is more favorable than many countries that tax capital gains at full income tax rates.
• Superannuation: Australia's compulsory super system (currently 11% of wages) is unique and reduces reliance on age pensions.

The OECD ranks Australia as having the 14th highest tax-to-GDP ratio among 38 member countries at 28.5% (2022 data), compared to the OECD average of 34%.

What's the difference between taxable income and gross income?

Gross income is your total income before any deductions or taxes are applied. This includes:

• Salary and wages
• Business income
• Investment income (interest, dividends, rent)
• Capital gains
• Government payments (like JobSeeker or parental leave pay)
• Foreign income

Taxable income is what remains after you subtract allowable deductions from your gross income. Common deductions include:

• Work-related expenses
• Investment property expenses
• Self-education expenses
• Charitable donations
• Income protection insurance premiums
• Depreciation on income-producing assets

Example: If your gross salary is $90,000 and you claim $5,000 in work-related deductions and $2,000 in charitable donations, your taxable income would be $83,000.

Important: Some income (like certain government payments) may be exempt from tax, while other income (like fringe benefits) may be taxed differently. Always check with the ATO or a tax professional about what constitutes taxable income in your specific situation.

How do I know if I'm an Australian resident for tax purposes?

The ATO uses four main tests to determine tax residency. You're considered an Australian resident for tax purposes if you:

1. Resides test: You reside in Australia according to ordinary concepts. This considers:
   • Physical presence in Australia
   • Intention and purpose of your stay
   • Family and business/employment ties
   • Maintenance and location of assets
   • Social and living arrangements
2. Domicile test: Your domicile (permanent home) is in Australia, unless the Commissioner is satisfied that your permanent place of abode is outside Australia.
3. 183-day test: You're actually present in Australia for more than half the income year (183 days or more), unless:
   • Your usual place of abode is outside Australia
   • You don't intend to take up residence in Australia
4. Superannuation test: You're a government employee posted overseas and contribute to certain Australian superannuation schemes.

Common misconceptions:

• Having a visa (even permanent residency) doesn't automatically make you a tax resident
• Australian citizens working overseas are often not tax residents
• You can be a tax resident of Australia and another country simultaneously (dual residency)

Why it matters: Tax residents are taxed on worldwide income and can access the tax-free threshold, while foreign residents are only taxed on Australian-sourced income at higher rates with no tax-free threshold.

If you're unsure about your residency status, use the ATO's residency decision tool or consult a tax professional.

What happens if I don't lodge my tax return on time?

The due date for most individual tax returns is 31 October. If you use a registered tax agent, you typically get an extended deadline (usually until May the following year).

Penalties for late lodgment:

• Failure to Lodge (FTL) penalty: $222 for every 28 days your return is overdue, up to a maximum of $1,110 for individuals.
• Interest charges: The ATO charges interest on any unpaid tax debt from the original due date until payment (currently 11.34% per annum as of 2024).
• Loss of refunds: If you're owed a refund, you have up to 2 years to lodge your return to claim it (4 years in some cases).
• Prosecution: In extreme cases of repeated non-lodgment, the ATO may prosecute, with penalties up to $5,500 or imprisonment for up to 12 months.

What to do if you've missed the deadline:

1. Lodge as soon as possible - penalties accrue until you lodge
2. If you can't pay immediately, lodge anyway and set up a payment plan with the ATO
3. In some cases, you can apply for penalty remission if you have a reasonable excuse (e.g., serious illness, natural disaster)
4. Consider using a registered tax agent who can often get you an extension

Special cases:

• If you have no taxable income (earned under $18,200), you generally don't need to lodge a return unless you had tax withheld
• If you're overseas, you still need to lodge if you have Australian-sourced income
• If you have a HECS/HELP debt, you must lodge regardless of your income level

How does the Stage 3 tax cut (from 1 July 2024) affect my tax?

The Stage 3 tax cuts represent the most significant change to Australia's personal income tax system in decades. Here's what changes from 1 July 2024:

Key Changes:

• Flatter tax scale: The 32.5% and 37% tax brackets are replaced with a single 30% rate for incomes between $45,000 and $200,000
• Increased thresholds:
  • 19% bracket: $18,201-$45,000 (unchanged)
  • 30% bracket: $45,001-$200,000 (new)
  • 45% bracket: $200,001+ (increased from $180,001)
• Removed 37% bracket: This bracket currently applies to incomes between $120,001-$180,000
• LMITO removed: The Low and Middle Income Tax Offset is not being continued

Who Benefits Most?

High income earners will see the largest benefits:

Income Level	2023-24 Tax	2024-25 Tax (Stage 3)	Tax Cut
$50,000	$5,092	$5,092	$0
$80,000	$14,017	$13,500	$517
$120,000	$29,467	$27,967	$1,500
$150,000	$40,367	$37,033	$3,334
$200,000	$63,067	$51,533	$11,534

Criticisms and Controversies

• Regressive impact: Critics argue the cuts disproportionately benefit high-income earners. Someone earning $200,000 gets a $9,075 tax cut, while someone earning $50,000 gets nothing.
• Cost to budget: The changes cost the budget approximately $20 billion annually in foregone revenue.
• Inflation concerns: Some economists warn the cuts could add to inflationary pressures by increasing disposable income.
• LMITO removal: Low and middle-income earners lose the offset they've become accustomed to, which may offset some of the benefits from the tax cuts.

What You Should Do:

1. Review your PAYG withholding to ensure you're not having too much tax withheld from your pay
2. Consider salary sacrificing additional amounts to superannuation if you're in a higher tax bracket
3. If you're a small business owner, review your business structure to ensure it's still optimal under the new rates
4. Update any financial plans or projections that were based on the old tax rates

For the most current information, check the Australian Government Budget website.

Can I claim home office expenses if I only work from home occasionally?

Yes, you can still claim home office expenses even if you only work from home occasionally, but the amount you can claim depends on your specific situation. The ATO provides three methods for calculating home office expenses:

1. Shortcut Method (80 cents per hour)

• Rate: 80 cents per work hour
• Coverage: Covers all additional running expenses (electricity, gas, phone, internet, stationery, computer consumables)
• Requirements:
  • You must keep a record of the hours you worked from home (timesheets, rosters, or a diary)
  • This is a temporary measure that has been extended until at least 30 June 2025
• Example: If you worked from home 2 days a week (16 hours) for 48 weeks, you could claim 768 hours × $0.80 = $614.40

2. Fixed Rate Method (67 cents per hour)

• Rate: 67 cents per work hour
• Coverage: Covers energy expenses (electricity and gas) and the decline in value of office furniture and furnishings
• Additional claims: You can separately claim:
  • Phone and internet expenses (work-related portion)
  • Computer consumables and stationery
  • Depreciation on computers, printers, etc.
• Requirements:
  • Keep a record of hours worked from home
  • Keep receipts for additional expenses you claim separately

3. Actual Cost Method

• Calculation: Claim the actual additional costs you incurred from working at home
• Coverage: Can include:
  • Electricity and gas (work-related portion)
  • Phone and internet (work-related portion)
  • Computer consumables and stationery
  • Depreciation on equipment (e.g., computers, printers)
  • Repairs to equipment and furniture
  • Cleaning expenses (if you have a dedicated work area)
• Requirements:
  • Keep detailed records (receipts, bills, diary entries)
  • Calculate the work-related portion (e.g., if your home office is 10% of your home's floor area, you can claim 10% of relevant expenses)
  • Have a dedicated work area (not required but helps substantiate claims)

What You Can't Claim:

• Occupancy expenses (rent, mortgage interest, property insurance, rates) unless you're running a business from home
• General household items (e.g., coffee, tea, toilet paper) even if used during work hours
• Expenses that are reimbursed by your employer

ATO Compliance Focus:

The ATO has flagged home office expenses as an area of compliance focus. To avoid issues:

• Only claim for hours you actually worked from home
• Don't "double-dip" by claiming the same expense under multiple methods
• Be reasonable with your claims - if you only worked from home 5 hours a week, claiming for 40 hours will raise red flags
• Keep contemporaneous records (records created at the time, not reconstructed later)

For more details, see the ATO's home office expenses guide.

How does marriage or de facto relationships affect my tax?

In Australia, your tax liability is generally calculated individually, not as a couple. However, your relationship status can affect certain tax obligations and benefits:

1. Medicare Levy Surcharge (MLS)

• The MLS thresholds are higher for couples:
  • Single: $93,000
  • Family/couple: $186,000 (plus $1,500 for each dependent child after the first)
• If your combined income exceeds the family threshold and you don't have private hospital cover, you'll each pay the MLS (1-1.5% of your taxable income)

2. Private Health Insurance Rebate

• The rebate is income-tested based on your combined income for MLS purposes
• Rebate tiers (2023-24):

  Income Threshold	Rebate % (Under 65)	Rebate % (65-69)	Rebate % (70+)
  ≤ $93,000 (single) or ≤ $186,000 (family)	24.608%	28.838%	33.067%
  $93,001-$108,000 (single) or $186,001-$216,000 (family)	16.405%	20.635%	24.865%
  $108,001-$144,000 (single) or $216,001-$288,000 (family)	8.203%	12.433%	16.662%
  > $144,000 (single) or > $288,000 (family)	0%	0%	0%

3. Spouse Superannuation Contributions

• You can claim a tax offset of up to $540 if you contribute to your spouse's super and their income is $37,000 or less
• The offset gradually reduces for incomes up to $40,000
• Maximum offset is 18% of contributions up to $3,000

4. Capital Gains Tax (CGT) Main Residence Exemption

• If you and your spouse own a home together, you can only have one main residence between you for CGT purposes
• If you own multiple properties, you'll need to nominate which one is your main residence

5. Family Tax Benefit (FTB)

• While not directly a tax matter, your combined income affects eligibility for FTB payments
• FTB Part A is income-tested based on your adjusted taxable income
• FTB Part B has a primary earner income test ($100,000 threshold)

6. Joint Ownership of Investment Properties

• Income and expenses are typically split according to ownership percentages
• You can choose different ownership splits for tax purposes (e.g., 90/10) but this must reflect the actual legal ownership
• Negative gearing benefits are split according to ownership percentages

7. De Facto Relationships

• The ATO recognizes de facto relationships (including same-sex couples) that meet certain criteria:
• You're not legally married but live together on a genuine domestic basis
• Your relationship has lasted at least 2 years (or there's a child involved, or the relationship is registered under state/territory law)
• For tax purposes, de facto couples are treated the same as married couples

8. Separation and Divorce

• If you separate, you'll need to update your details with the ATO, especially for:
• Medicare levy surcharge calculations
• Private health insurance rebates
• Family tax benefit eligibility
• Child support arrangements
• Property settlements may have CGT implications

For complex situations, especially involving property settlements or business ownership, it's wise to consult both a tax professional and a family lawyer to understand all implications.