Oct 14, 2020 Author: Accounts Junction
If you are working in Australian and are a foreign national then you are liable to the income tax as laid down by the ATO (Australian Taxation Office). The foreigners here are obliged to pay the taxes for the income sourced in Australia. Apart from the salaries or wages, they are liable to pay the tax on the dividends and interests gained through the source in Australia. You definitely must approach a proper tax consultant to know about the proper Australia income tax for foreigners. ATO has led down proper bifurcation of the tax layout for the foreigners working in Australia. They have made very legitimate tax slabs for the Australians working abroad. In this case, a proper categorization is initially made for the Australians that are working abroad. Generally, a double tax treaty prevails for these individuals who are working abroad.
The following categorization is generally made for the people who are working outside Australia
1. Residents
All the investment done by the Australian in different parts of the world is taxable. It includes a share portfolio, dividend income, funds borrowed, rental income for the properties, etc.
Whatever income is made by the Australian residents from employment outside Australia are liable to the tax payments. The claim of Foreign Income Tax Offset (FITO) can be made from the respective foreign country. There can be other exemptions too under specific circumstances for the foreign projects.
The profit made by disposing the asset with the transaction cost has certain slabs for the taxes. 50% discount is given for the asset held more than 12 months, so only 50% of the profit is taxable.
Those exceeding a specific income threshold a tax payment of 2% medicare on the income is made.
2. Non-residents
A clear demarcation of the tax slabs are made for the income made through the royalties, interest, and dividend income for non-residents. The tax rates are made as per any double tax agreement made between Australia and respective countries.
The income consideration is made from the location of the income sourced. The case where the sourcing of employment is made, there will be a provision with tax-exemption.
The temporary residents and non-residents need to pay the capital gain tax. There is some specification of the 50% discount on the tax from capital gains. The details of the CGT exemption must be checked properly, if you are eligible for it.
Medicare levy or any such kinds of surcharge are not applicable for the non-residents.
Regarding the tax aspects, the Australia income tax for foreigners is a little complex one. You must have a proper knowledge about all the aspects and the category where you fit in. As multitude factors are there in the taxation related to the foreign income, it is generally recommended that an advice of a proper tax consultant must be there.
Accounts Junction is a prominent Accounting agency which can provide the tax consultation in Australia. They have given proper tax advice in a much simpler way.
