Australian Tax - what you need to know

The Australian tax system works pretty similar to New Zealand. The Australian Tax Office/Department is the equivalent of the IRD in New Zealand. Your employer will pay tax to the Australian Tax Department/Office on your behalf. If you are self employed you will need to file your own tax returns, so you will need to get an Australian tax accountant to help you file everything correctly.

Australian Tax File Number

A Tax File Number (TFN) is the Australian equivalent of the New Zealand IRD number. You do not need to have a TFN to work and pay Australian tax, however you will be charged at a higher tax rate. The Australian tax year runs from the 1st of July through to the 30th of June.

You should apply for a TFN number as soon as you arrive in Australia. You are not able to apply from New Zealand. You can apply online here: https://www.ato.gov.au/individuals/tax-file-number/apply-for-a-tfn/foreign-passport-holders,-permanent-migrants-and-temporary-visitors---tfn-application/

Australian Tax Rates

Please find below a table containing the Australian individual income tax rates

The Government has announced that from 1 July 2016, for individual taxpayers, the marginal tax rate of 37 per cent starts at $87,000 instead of the previous $80,000.

This new threshold also applies to foreign residents and working holiday makers.

The following rates for 2016–17 apply from 1 July 2016.

 Taxable income  Tax on this income
 0 – $18,200  Nil
 $18,201 – $37,000  19c for each $1 over $18,200
 $37,001 – $87,000  $3,572 plus 32.5c for each $1 over $37,000
 $87,001 – $180,000  $19,822 plus 37c for each $1 over $87,000
 $180,001 and over  $54,232 plus 45c for each $1 over $180,000


The above rates do not include the:

  • Medicare levy of 2%
  • Temporary Budget Repair Levy; this levy is payable at a rate of 2% for taxable incomes over $180,000.

See also:

Comprehensive Australian Tax Calculator

The below links will take you to the Australian tax calculator on the Australian Tax Department/Office website. This calculator will help you to calculate the tax you owe on your taxable income for the previous three income years.

It will estimate your tax payable and will also calculate:

  • Medicare levy
  • Medicare levy surcharge
  • Higher Education Loan Program (HELP) repayment
  • Student Financial Supplement Scheme (SFSS) repayment, and
  • Any tax offsets that may apply.

It will take these, along with other tax credits, into account in estimating your tax refund or debt.

https://www.ato.gov.au/Calculators-and-tools/Host/?anchor=STC&anchor=STC#STC/questions - this calculation will take between two and 10 minutes to complete.

Inform the IRD that you are Moving to Australia

New Zealand tax residence questionnaire IR886

The IR886 form tells the IRD you are leaving, or have left New Zealand so they can tell you your tax residence status and if you have any further New Zealand tax obligations. It also includes the IR597 form you can use to elect someone in New Zealand to act on your behalf.

Also inform the IRD of your new address in Australia when you have one. It is easiest to do this online. Click here to register for the IRD's online service, which means you can easily update your address while overseas and continue to be informed about things like student loan repayments or other tax obligations you may have.

If you have any questions, please fill out the below form and we will get back to you asap.

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0 # Do I need TFN number?Breanne 2017-06-12 23:56
I am currently attending university in NZ. As part of my degree I will be undertaking a 9 week paid internship in Australia, and then returning to NZ. Do I need to apply for a TFN number.
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0 # ANSWER: Do I need TFN number?MTA Team 2017-06-18 21:55
Hi,
Thank you for your comment.
Yes you will need to apply for a TFN when you arrive. You can do it online: https://www.ato.gov.au/individuals/tax-file-number/apply-for-a-tfn/foreign-passport-holders,-permanent-migrants-and-temporary-visitors---tfn-application/.
Good luck with your move.
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0 # ANSWER: IrdMTA Team 2015-08-26 06:43
Hi Janette,

Thank you for your enquiry.

You need to apply for the IRD number equivalent, tax file number (TFN), when you arrive in Australia. You are not able to apply from New Zealand.

You can apply online by following the below link: https://iar.ato.gov.au/iarweb/default.aspx?pid=4&sid=1&outcome=1.

Please note, you are able to start work without a TFN.

Good luck with your move.
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0 # Ird Jeanette 2015-08-26 06:42
Hello I'm want it to know if I want to move to Australia how can I apply for ird ? So that I can work in Australia .. And how long to I have to wait for if I apply ?? Thank you Jeanette
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0 # ANSWER: new ird number when I arrive in AustrailaMTA Team 2013-07-15 05:03
Good morning Malcolm,

Thank you for your comment.

Please find below the link to the section on 'understanding tax - starting out' on the Australian Taxation Office website: http://www.ato.gov.au/Individuals/Income-and-deductions/Understanding-tax---starting-out/.

Here is the link to the section on 'getting a tax file number': http://www.ato.gov.au/Individuals/Income-and-deductions/In-detail/Your-tax-file-number/Getting-a-TFN/. Which will eventually take you to how to apply online (https://iar.ato.gov.au/IARWeb/default.aspx?pid=4&sid=1&outcome=1). In this section scroll down and click next until and it will take you through the process.

You can start work without a tax file number, but you will pay more tax.

Please let me know if you have any feedback on the above or helpful information for other visitors to my site.

Thanks,
MTA Team
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0 # new ird number when i arrive in austrailamalcolm blackledge 2013-07-15 04:48
hello how do i go about getting an ird number as im flying in aussie on the 25th and start work on the 31st can i do this from nz.
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