Australian Backpacker Tax 2020



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The Australian Backpacker Tax has been clarified as valid.

In October 2019 the Federal Court ruled that a tax on working holiday visa holders was invalid, and an estimated 75,000 backpackers were told they might receive refunds from the Australian tax office (AT) for overpaid tax.

However, the ATO appealed the court ruling.

In August 2020, a full bench of the Federal Court ruled the backpacker tax was not discriminatory, and the tax can continue to be collected from those on Working Holiday Visas.

The backpacker tax applies to those on a 417 or 462 visa, and is charged at the rate of 15%.

Along with other non residents, they do not get the benefit of the tax free threshold, where no tax is paid on the first $18,200 of annual income.


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A backpacker that earns $37,000 in the year would pay $5,550 tax.

In comparison, an Australian Citizen or Resident would pay a total of $3,867.

 

ato.gov.au/…/Working-holiday-makers/

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