Key Tax Rules for Visa Holders

Residency for Tax Purposes

• Your residency status determines whether you’re taxed as an Australian resident or foreign resident.
  • Residents are taxed at lower rates and may access the tax-free threshold and certain offsets.

Working Holiday Visa (Subclass 417/462)

• First $45,000 of income taxed at 15%; ordinary tax rates apply above this amount.
• Tax File Number (TFN): You must provide your employer with a TFN to avoid higher withholding rates.

Skilled Migration Visas

• Skilled migrants are typically treated as residents for tax purposes if they live and work in Australia.

Foreign Residents on Other Visas

• Foreign residents are taxed at 32.5% from the first dollar earned, with no access to the tax-free threshold.

To ensure compliance, it’s crucial to understand how your visa affects your tax obligations.

FAQs

Q: Do I need to lodge a tax return if I’m on a visa?
A: Yes, if you earned income in Australia. Lodging ensures compliance with tax laws and allows you to claim refunds if overpaid.

Q: How do I determine my residency status for tax purposes?
A: Residency status depends on your visa type, time spent in Australia, and whether Australia is your permanent home. Use the ATO’s residency tool for guidance.