Australian tax file number, tax rates, tax calculator, and finding a tax agent/accountant.

The Australian tax system works pretty similarly to New Zealand. The Australian Tax Office/Department is the equivalent of the IRD in New Zealand.

Your employer will pay the Australian Tax Department/Office tax 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.

On this page, you will find the following helpful information:

• Double Tax Treaty between NZ and Australia
• Australian Tax File Number
• How to apply for a TFN
• How long does it take to get an Australian tax file number?
• Already have a TFN and need to find the number?
• Starting work and paying tax
• As a New Zealander, will you have to pay higher tax?
• Australian temporary resident for tax purposes
• Australian Tax Calculator
• Tax Return / Tax Refund
• Why use an Australian Tax Agent/Accountant
• Obtaining an ABN
• Inform the IRD that you are Moving to Australia 

Double Tax Treaty between NZ and Australia

The Double Tax Treaty (DTT) between New Zealand and Australia is an agreement signed by both countries to avoid double taxation of income earned by their respective residents.

The DTT outlines the rules for determining which country has the right to tax specific income earned by individuals and businesses in both countries. The DTT aims to eliminate double taxation, reduce the tax barrier to cross-border trade and investment, and promote economic activity between the two countries. It also includes provisions for the exchange of information to assist in the prevention of tax avoidance and evasion.

The DTT covers a range of areas, including income from employment, investments, royalties, and pensions. The agreement also includes provisions for resolving disputes that may arise between the tax authorities of the two countries.

Overall, the DTT helps provide greater certainty and predictability for individuals and businesses active in New Zealand and Australia. It helps to ensure that they are not unfairly taxed in either country due to their cross-border operations.

You can read more on the Inland Revenue website on Double tax agreements (DTAs) or speak to your accountant. 

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 a higher tax rate. You can start working without a TFN and inform your employer that you have applied for one, but they may still use the higher tax rate until your TFN comes through. The good news is that you may be able to claim the overpaid tax; you can find more info about tax refunds below.

A TFN will get you in line with the PAYG (pay as you go) earn scheme, which means that your Australian employer will withhold and report tax under your TFN. Same as NZ.

The Australian tax year runs from the 1st of July through to the 30th of June.

You should apply for a Tax File Number Aus as soon as you arrive in Australia. You are not able to apply from New Zealand.

You can apply for a tax file number online if you meet these three conditions:

1. You are a foreign passport holder, permanent migrant or temporary visitor.
2. You are already in Australia.
3. Your visa is one of the following:
   • a permanent migrant visa
   • a visa with work rights
   • an overseas student visa
   • a visa allowing you to stay in Australia indefinitely (including New Zealanders automatically granted a visa on arrival).

How long does it take to get an Australian tax file number?

You should receive your TFN within 28-30 days. The ATO will send your TFN to the Australian address you use on your application.

Please note you can start working without a TFN, but you might get taxed a higher amount until it comes through.

Once you have received your TFN, it’s important that you keep it and all your personal information secure to prevent identity theft.

 

Already have a TFN and need to find the number?

If you already have a TFN and don’t remember the number, you can find it online in ATO online services via your myGov account: https://my.gov.au/.

If you don’t have a myGov account, you can usually find your TFN on:

• your income tax notice of assessment, if you have lodged a tax return
• letters you have received from the ATO, such as a statement of account
• a payment summary or income statement (provided by your employer)
• your superannuation account statement.

If you use a registered tax agent/accountant, you can ask them for your TFN. If you still can’t find your TFN after checking these options, phone the ATO.

Starting work and paying tax

New Zealand citizens are treated as residents for tax purposes once they complete a stay of six consecutive months in Australia (183 days).

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

Current resident individual tax rates

Taxable income	Tax on this income
0 – $18,200	Nil
$18,201 – $45,000	19c for each $1 over $18,200
$45,001 – $120,000	$5,092 plus 32.5 cents for each $1 over $45,000
$120,001 – $180,000	$29,467 plus 37 cents for each $1 over $120,000
$180,001 and over	$51,667 plus 45 cents for each $1 over $180,000

The above rates do not include the Medicare levy of 2%. You can work out your Medicare levy using the calculator on the ATO website.

If you do not stay in Australia for six months (183 days), you will be treated as a foreign resident for tax purposes. This means that you are not allowed to use the tax-free threshold in your return (earn under $18,200), and you will be charged the starting tax rate of 32.5%. You would be eligible to claim a tax refund only if your Australian employer withholds more than 32.5% in tax, and you will get the difference, meaning only the overpaid amount of tax. TaxBack.com can help you with this.

Foreign resident tax rates 2021–22

Taxable income	Tax on this income
0 – $120,000	32.5 cents for each $1
$120,001 – $180,000	$39,000 plus 37 cents for each $1 over $120,000
$180,001 and over	$61,200 plus 45 cents for each $1 over $180,000

 

As a New Zealander, will you have to pay higher taxes?

Once you have your TFN, you will pay the same tax rate as an Australian resident or citizen.

The standards the ATO uses to determine your tax residency are not the same as those used by the Department of Immigration and Border Protection – for example, you could be an Australian resident for tax purposes even if you’re not an Australian citizen or permanent resident.

To understand your tax situation, you first need to work out if you are an Australian or foreign resident for tax purposes. You can do that here using the ATO’s ‘Are you a resident?‘ tool. 

Australian temporary resident for tax purposes

You do have the option to be an Australian “temporary resident” for tax purposes.

There can be some benefits for New Zealand citizens living in Australia who are considered temporary residents for tax purposes. This is because, as temporary residents, they may be eligible for certain tax concessions and exemptions, including:

1. Lower tax rates on their Australian income: Temporary residents are only required to pay tax on their Australian-sourced income, and their tax rate may be lower than that of permanent residents.
2. Exemption from capital gains tax on their foreign assets: Temporary residents are generally exempt from paying capital gains tax on assets they own outside of Australia.
3. Exemption from the Medicare Levy: Temporary residents are exempt from paying the Medicare Levy, which is a tax on most Australian taxpayers that helps fund the public health system.

You can read more about this in Beyond Accountancy’s post: NZ taxes: something every Kiwi in Australia needs to know.

However, it’s important to note that these benefits depend on individual circumstances and may not apply to all temporary residents. It’s always best to consult a qualified tax professional who can provide tailored advice based on your situation.

 

Australian Tax Calculator

If you’ve ever worked Down Under, you probably paid tax and are due an Australian tax refund. This calculator is FREE to use and will give you an instant Australian tax refund estimation. The average Australian tax refund with taxback.com is AU$2,600, so it’s well worth checking out the online tax calculator now. Use TaxBack’s Australian tax refund estimator now, and you will be one step closer to getting your Oz tax refund! Australian Tax Calculator facts It provides an instant Oz tax refund estimation The Australian tax estimator takes just 2 minutes to fill out TaxBack.com will send a copy of your tax refund calculation straight to your inbox! The online Australian tax calculator is FREE The Oz tax calculator provides a no-obligation way to find out what you’re owed! Taxback.com provides personal & corporate tax solutions. They will help you claim tax refunds and file tax returns. Get your tax back today!

Tax Return / Tax Refund

The Australian financial year runs from 1 July until 30 June each year. Individuals have until 31 October to lodge tax returns on their own. If you use a tax agent, you can secure an extended deadline.

New Zealand citizens are not required to lodge a tax return if they have not commenced paid employment or stayed in Australia for less than six months, and the only source of Australian income was bank interest, dividends or royalties (from which non-resident withholding tax has been correctly withheld).

You must lodge a tax return if any of the following apply:

• the tax was deducted from any payments (such as wages) made to you during the financial year
• you are an Australian resident, and your taxable income was more than the tax-free threshold
• you are a foreign resident, and you earned more than $1 in Australia during the financial year
• you are leaving Australia permanently or for more than one financial year
• you wish to claim any tax deductions

People submit a tax return mainly to claim overpaid tax and get a tax refund.

If your finances are straightforward (for example, your only income is from one employer, and you have few or no deductions to claim), try doing it yourself online via myTax, which is similar to MyIR with the IRD. Find here instructions to help you complete your tax return using myTax – https://www.ato.gov.au/Individuals/myTax/.

For more information, read my filing for your Australia Tax Return post.

Why use a Tax Agent/Accountant

Lodging a tax return can be daunting if you are not a professional. To ensure maximum legal refund and compliance with the Australian Authorities, you should use an Australian Tax Agent/Accountant.

You can find accountants in your area by searching online. Make sure you check the tax and BAS agent register before you go ahead with any service.

Obtaining an Australian Business Number (ABN)

If you plan on starting your own business and working as a sole trader contractor or sub-contractor, you must apply for an Australian Business Number or ABN. Same as you would apply for a New Zealand Business Number (NZBN) in NZ.

ABN is a unique 11-digit number that identifies your business or organisation to the government and community.

To apply for such you must have obtained a Tax File Number first.

You can apply for ABN by registering directly with the Australian Government – https://www.abr.gov.au/business-super-funds-charities/applying-abn.

Taxback.com can also help with this matter to ensure a trouble-free application. Check out more information on their webpage – ABN application. Service fee applies.

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.

You might also be interested in…

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• Everything Money
• Find a House to Buy or Rent in Australia
• Australian Mortgage

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