From 1 January 2017 the tax rates relating to working holiday makers (including backpackers) on 417 and 462 visas have changed. From that date, the first $37,000 of income for these workers is taxed at 15% and any income over this amount is taxed at ordinary non-resident tax rates.

 

If you employ any workers with these visa categories you must:

 

• Register with the tax office to withhold at the working holiday maker (this is in addition to your ordinary PAYG withholding registration for other employees).
• Ensure that your employees have provided you with a Tax File Number declaration
• Withhold tax at 15% on the first $37,000 paid to each working holiday maker employee
• Withhold tax at the  normal non-resident tax rates for any income over $37,000

 

The working holiday maker rates only apply from 1 January 2017. If you were employing these workers prior to that date you will need to issue them with two payment summaries for the 2017 year, one covering the period from 1 July to 31 December 2016 and one covering the period from 1 January to 30 June 2017.

 

If you currently employee these types of workers, you must register by no later than 31 January 2017. Penalties will apply if you ail to register by this date.

 

You can check your worker has a subclass 417 or 462 visa by using the Visa Entitlement Verification Online at border.gov.au/vevo