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June 27, 2023

Lodging a tax return in Australia: everything you need to know

Starting from July 1st, you can apply for “tax back” or “tax return” in Australia. Whether you live in Australia with a Working Holiday Visa, sponsor visa, or permanent visa, you will need to file an Australian tax return. In this article, we explain what tax back is and how to do it.

What is tax back?

Tax back in Australia refers to the process by which an individual requests a refund of excess taxes paid to the Australian government. This can happen when an individual has paid more taxes than owed due to various factors, such as errors in the tax return, overlooked deductions, or improperly applied tax deductions.

Tax back can be requested through the “Tax Return” or “Income Tax Return” process, which involves filing a tax return with the Australian Taxation Office (ATO). The tax return includes reporting income, eligible expenses, and deductions to calculate the exact amount of taxes owed or refundable.

FIRST STEP: LINK ATO – AUSTRALIA TAX OFFICE – TO MY GOV

You can do this by calling 13 28 61 and requesting the linking code to connect ATO services to your myGov account. Alternatively, you can independently verify your account on the myGov website (you will need your Tax File Number, account number, date of birth, and other personal information provided previously, such as superannuation number).

When to do tax back?

It is important to note that you can complete this process during the “tax window,” which runs from July 1st to October 30th.

Why do tax back?

During the working year, employers make tax contributions on behalf of employees. However, it is possible to have been overtaxed. To verify if the tax paid was appropriate, a process called Tax Return can be initiated. If the taxes were correctly calculated, there will be no refund or payment owed to the government.

In the case of overtaxation, individuals have the right to claim a refund. Conversely, if one has been undertaxed, the difference must be paid.

For Working Holiday Visa holders earning up to $45,000, the tax rate is 15% (source: https://www.ato.gov.au/Rates/Individual-income-tax-rates/).

Who is required to file a Tax Return in Australia?

Working Holiday Visa holders who did not work under an ABN and earned less than AUD $45,000 are not required to file a tax return. All other individuals are obligated to file a tax return.

Tax return for Working Holiday Visa

It is important to note that Working Holiday Visa holders find it challenging to claim significant amounts of money since they are not eligible for the tax-free threshold on the first $18,200 earned, which applies to other visa types such as Student Visa, Post-Graduate, Sponsors, PR, and citizens.

If I have a Working Holiday Visa and I’m not obligated to file a Tax Return, can I still do it? Is it worth it?

Absolutely! You can still file a tax return even if you are not obligated to do so. The possibility of getting a refund depends on various factors such as income level, amount of taxes paid, and work-related expenses – these expenses should be included under the “deduction” category.

How to do tax back?

Find here a step-by-step guide to lodge your tax return autonomously!

  • Log in to the myGov website – https://my.gov.au
  • Click on Tax > Lodgment > Income Tax
  • Lodge a Tax Return and follow the instructions.

During the tax back process, you will be asked to review all payment summaries for activities conducted in that financial year and whether you incurred expenses for work equipment, training courses, or fuel (keep in mind that you may be asked to provide proof of these expenses in case of audits, so avoid inflating these costs).

  • Provide your contact information, including phone number, address, and email address.
  • Enter your banking details, including your name, surname, BSB (Bank State Branch) number, and account number.
  • Declare yourself as a backpacker (if you are in Australia with a Working Holiday Visa) and specify your employment status as casual, part-time, or full-time.

Specifically, answer the following questions:

  • Were you a resident in Australia during the last financial year?
  • Were you married during the last year?
  • What type of income did you have (derived only from work in Australia or from overseas as well)? Tick the relevant boxes that describe your situation.

During this stage, some options may already be automatically filled in. Make sure to verify their accuracy.

This is where you actually perform the tax back. First, select the type of activity from which you earned the highest income, and then proceed to enter any applicable deductions.

Tax back with a tax agent:

If you wish to entrust the process to a professional, whom can you turn to? To obtain professional assistance in preparing your Tax Return, it is advisable to consult a tax agent. A tax agent will provide expert advice and ensure that the process is handled correctly.

We hope this information has been useful in understanding the concept of Tax Back in Australia and how to benefit from it. Remember to take advantage of the ‘tax window’ to complete your tax return. If you have further questions, feel free to reach out to our infopoint at infopoint@atlasmigration.com.

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