Thousands of backpackers could be eligible for a tax refund
If you are a working holidaymaker who is both an Australian resident for tax purposes and from Chile, Finland, Japan, Norway, Turkey, the United Kingdom, Germany or Israel, you could be in line for a tax refund.
Catherine Addy took the Australian Taxation Office to court in 2019, successfully arguing that her British citizenship means she was taxed at a higher rate than Australian residents. The tax office appealed the ruling, which was then upheld in August 2020, determining the tax was not discriminatory.
Ms Addy subsequently appealed to the High Court, who overturned the tax office’s appeal.
Under rules introduced in 2017, working holidaymakers on 417 visas must pay a 15 per cent levy on income up to $37,000.
The ruling could result in thousands of foreign workers from nations with similar tax treaties receiving refunds from the tax office.
However, the tax office has indicated to employers they should not change tax withholding rates for backpackers stating it is “currently considering this decision and will provide further guidance as soon as possible.”
Last updated: 6th November 2021