Below, you can find some information about the Australian tax system and rates, which is useful for anyone planning to move, study, or work in Australia.

Australia has a well-developed and transparent tax system that includes various types of taxes at both the federal and state levels. It is overseen by the Australian Taxation Office (ATO), which is responsible for tax collection, enforcing regulations, reviewing tax returns, and investigating tax fraud.

To register for tax purposes, individuals will need a Tax File Number (TFN), while sole traders and businesses will require an Australian Business Number (ABN).

Australia’s income tax system is progressive, meaning the higher the income, the higher the tax rate.

Australian Residents:

For tax purposes, you are considered to be an Australian resident if:

·       You have always lived in Australia or have a permanent residency status

·       You have been continuously living in Australia for at least six months, during which you have been working at the same job and living in the same place.

·       You have lived in Australia for more than six months within a year, unless your permanent home is overseas, and you do not intend to live in Australia long-term.

·       You are an Australian resident temporarily traveling abroad without establishing a permanent residence in another country.

·       You are an international student in Australia enrolled in a course longer than six months.

·       Australia currently has five tax brackets.

It’s important to note that when your annual income exceeds a tax bracket, only the portion above that threshold is taxed at the higher rate, not your entire income.

Australia has five tax brackets, and it’s important to understand that only the portion of your income that exceeds a given bracket is taxed at the higher rate, not the entire income.

The table below shows the current tax system effective from July 1, 2024:

The above rates do not include the additional 2% Medicare levy.

For those starting a new life in Australia, it’s important to note that once you’ve lived and worked in the country for over 12 months, your income up to $18,200 is completely tax-free.

Non-Residents:

You are considered to be a non-resident if:

·       You come to Australia temporarily for work and do not meet the residency criteria outlined above.

·       Neither you nor your spouse (if applicable) qualifies as an Australian resident.

Non-residents are not required to pay the Medicare levy.

Keep in mind that for the latest updates and detailed information, you must always refer to the official ATO website!

After arriving in Australia, we can assist you with applying for a Tax File Number (TFN). For more information, feel free to contact us!