Last version updated in June 2023.
All workers in Australia must lodge a tax return to the Australian Tax Office (ATO) and pay income tax. The Australian income year starts on July 1 and ends on June 30 the following year.
The tax rate depends on your status in Australia and on your income. If you’re an employee (i.e., your employer pays you an hourly wage or a salary), income tax is withheld from your salary or wages and is recorded on your pay slips. If you’re self-employed, income tax is not withheld—you will have to pay a lump sum to the ATO at the end of the fiscal year, so plan for the expense!
On top of income tax, you also contribute to a retirement fund called “superannuation.” Your employer pays into this fund on your behalf, usually quarterly.
Confused? Read on for a complete overview of the Australian income tax system, superannuation, the “backpackers tax” changes introduced in 2017 and the subsequent “working holiday makers status.” You will also learn how to lodge your tax return and claim tax back—yay, potential money!—when you leave Australia.
But first things first, remember to get your Tax File Number (TFN) when you land in Australia. You need it to work and to make sure you’re not being charged at a higher tax rate.
Final note—all figures are given in Australian dollars.