As of the new year (January 1st 2017) the tax rates for ‘working holiday makers’ will change. This change will impact those on a 417 or 462 Visa. In the media these changes have been termed ‘Backpacker Tax’ and have been know as the ‘working holiday maker tax rate’ as well.
What do you need to know?
- If you employ a ‘working holiday maker’ that is on a 417 or a 462 Visa, then from January 1st 2017 you will need to withhold 15% from every dollar earned up to $37,000 (foreign resident tax rates apply from $37,001).
- There are other obligations that will need to be met, such as registering to withhold this tax (there are implications if you do not) and if you already employ holidaymakers you will need to issue two payment summaries (with different rates) for the 2016/17 tax year – one up until 31 December 2016 and another from 1 January 2017.
- Also penalties may apply if you employ holiday makers but don’t register.
To find out more and if this change will impact your business please contact Rubiix Business Accountants (on 03 9603 0066) for specific advice.
