With the new backpack tax coming into effect early next year, the federal government recently urged backpackers to contact (ATO), the Australian tax agency, to learn about their tax status and the rules for implementing the new backpack tax.
Backpacker confirms tax status
The new backpack tax will come into effect on January 1 next year, followed by a 15 percent income tax for backpackers who work in Australia on a 417 visa. However, the tax rates used by backpackers in Australia this year will also vary from person to person, depending largely on their tax status. As a result, the Australian tax Authority said backpackers had better be able to confirm their tax status in advance and understand the tax range they belong to.
In view of the employers' confusion over the implementation of the new backpack tax, the Australian tax Authority also urged backpackers to confirm their tax status to their bosses to ensure that their taxes were in line with the rules.
Backpackers' retirement tax has also changed
By next July, backpackers' taxes will become more complicated with the introduction of a new tax on backpackers. According to the new backpacker's old tax, backpackers who plan to leave Australia and want their pensions paid by next July will also have to pay a tax rebate of 65% of their retirement tax from Australia.
In addition, the Australian Inland Revenue Authority has posted a new tax rate form on its official website that lists the tax rates to be paid by backpackers and employers from next year. A spokesman for the Inland Revenue Department said the first A $37000 portion of the total revenue of backpackers would be subject to a 15 percent tax rate. He also explained that, given the employer's need to pay a pension for backpackers, he could apply for a pension when the backpacker left Australia, subject to a pension rebate. "as of July 1 next year, all backpackers will be taxed 65% on pension rebates." However, he added, "if a backpacker applies for a tax rebate, we will analyze his tax data. If he does pay more tax, we will refund some of the tax, but if he pays less tax, he will have to make up for the tax he owes. "
Explain the New backpack tax in detail with a case study
The Australian Inland Revenue Authority also cited a case to explain the implementation of the new backpack tax. In this case, Louis (Belgian Louie), a backpacker with a 457 visa to work in Australia, began working on a mango plantation in northern Queensland on January 10. He gets a daily salary of A $100, paid once a week. His first paycheck was A $500, but according to the new backpack tax, the salary would also have to pay a tax of 15 percent, so he would have to pay A $75 to the IRD.
In addition, since the Australian Inland Revenue Department has initiated information sharing with the Australian Immigration Department, if there has been a "tax evasion" by a visa holder, the visa holder will apply for other Australian visas in the future. Its tax stain will be used as a reference to affect the outcome of its visa approval.