Backpacker Tax Back / Travellers Tax Refunds
CLICK HERE to get your Australia Tax back refund completed by an Australian Chartered accountant, for a low fixed fee ( no percentage) and with no hidden costs....EVER !
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Unfortunately when you work in Australia you will have to pay on your wages and this will be deducted every payday by your employer. Luckily you can often claim a proportion of tax back at the end of each tax year or if you leave and head home half way through a tax you can normally apply for a tax return if you can answer yes to ONE of the following questions1. Have you BEEN in Australia or INTEND to stay for a minimum of 6 months of the tax year (1 july -30 june)?
2. Have you worked for one employer continiously for 4 months OR 2 employers consistently for 5 months?
3. Have you paid tax?
If the answers are YES to ONE of the above you may well be considered as a resident for tax purposes and be entitled to a backpacker tax refund so you can claim your tax back. Find out if your eligible here
When can I claim?
The Australian tax year runs from 1st July to 30th June so if you have been in the country or intend to be for 6 months then you can apply at the end of each tax year ( eg after 30 June) AND during a tax year if you are permenantly departing Australia part way through the tax year.. For example if you arrive in January 2010 and you are here until January 2011 then you can apply for a tax refund after the 30 June 2010 (at the end of the 09-10 tax year). Then when you leave in Jan 2011 you will be part way through the new tax year so should lodge for tax refund when you leave.
If you have been in the country 6 months and leave before the end of the tax year you can apply for your tax back when you leave. Applying during a current tax year often means that it will take longer to receive your tax refund 3-6 weeks.
Why do I get a tax refund?
Tax and tax refunds are complicated. Basically, as you have been in the country for 6+ months you are classed as a resident for tax purposes. That means you are entitled to a certain tax-free threshold of $18,200 ( $6000 for years up to 2011) and to claim deductions against your tax. If you have earned under $18,200 and been in Oz for the whole tax year then you will get all your tax back. When you work you the tax office assume that you will be in the job long term so they assume you will earn eg $500 a week every week for the whole tax year and tax you accordingly. If you only do the job for a few months then you will have overpaid on your tax.
How much will I get?
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How long is a piece of string? That really depends on how much you have earned, what deductions you can claim etc etc etc…..! A lot of traveler tax refund companies claim their average return to be around $2000 but it all depends on you, your circumstances and deductions.
What are deductions?
There are a multitude of things you can deduct from your tax and they vary from industry to industry. Basically, it is any costs you have incurred in generating your income. A simple example would be if you work in construction and have to buy steel toe capped boots you could claim this cost back. Another example is if you had to complete your RSA and RCG training to do your job you could claim the costs back against tax.
How do I go about claiming a Tax refund?
In order to claim the biggest tax back / tax refund possible it is best to use a Backpacker tax agent as they will be able to advise of what you can and cannot claim for.
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Which tax refund company is best?
There are quite a few companies out there all offerring a different service. You should look for a few key things to ensure that you are getting the best value for service an also going to get the biggest refund and lowest fees.
1) Are they Registered Chartered Accountants in Australia? if so you are protecetd by the institute of Chartered accountants and you will know you are recieving the hightest level of service. You will be very surprised how many are not registered in Australia.
2) Are they In Australia? Believe it or not some of the biggest names are not
3) Percentage fees SUCK - use a company that offers a flat fee to do your return. It takes the accountant (that is even if they are an accountant) the same amount of time to do you return if you get $300 or $3000 back - Australians do not pay percentage fees and neither should you they are a rip off.
4) Are there hidden fees ? Some companies appear cheap but then they charge if you want the fee to be taken our of your refund, large amounts to transfer the money into your account and high fees such as admin fees. Make sure you read the small print.
5) No refund No fee - It is sometimes possible that you may actually owe the tax office if you have been paying at the wrong rate or similar. Use a company that offers no refund no fee as some charge you EVEN when you then have to pay the tax office money.
We try to offer impartial advice but this is an area that we get so many complaints about firms that we established our own website to deal with it. For a low fixed fee service, completed by a Australian chartered accountant with no hidden fees and prompt service we suggest www.taxrefund4travellers.com.au . Yes we have a part interest in the firm but just consider the points above before selecting other firms.
Keep your pay slips and end of year certificates (PAYG)
At the end of the tax year every employer you have worked for will send you a PAYG summary. This will detail the total they paid you and the amount of tax. It is also a good idea to hold onto your pay slips as in some instances you can use your final pay slip. There is nothing stopping you requesting your PAYG when you leave each job and no need to wait until the end of the tax year. Remember to ask and they will provide it so you can save time when lodging your return. If you are missing any certificates simply contact your employer to request them. Many Backpacker tax refund firms offer to contact your employers on your behalf saving you the effort.
How long will my refund take?
That really depends but provided you have all your documents, if you claiming part way through a tax year and how fast your tax agent can finalise your return. Generally, if you have all the documents (PAYG) and are not claiming in the middle of a tax year then normally around 3-4 weeks.
Can I claim after I have left Australia?
Yes, if you are back home there is nothing to stop you lodging a tax return for your 6 + months in Australia. Many traveller tax refund companies offer easy online application systems so it’s easy to handle it when back home.
How do I get my money?
You can have your refund paid into your Australian bank account free of charge. If you have closed it or no longer in Australia most tax refund agents offer deposit into an overseas bank account you will have to pay the transfer fee, normally around $30, and remember the current exchange rate will effect the amount.
What else do I need to know?
Tax is a complicated issue and best left to the professional who know it inside out. You can check out the Australian Tax office (ATO) for more info or simply speak to a backpacker tax refund firm who will give you the low down and get you a great return. So no more going home broke !!!
Learn more about Tax in Australia and Tax file numbers and Superannuation and bank accounts