Mrs Kiwi

Hi guys,

hope you can help with a TFN / tax query.

Hubbie and I arrived in Australia 3 weeks ago for a permanent stay and our TFN's have just arrived in the post. My hubbie's is fine, it just says at the top "Tax file number advice" as he is a Kiwi but I am on a 461 visa as the spouse of a Kiwi and my TFN letter says "Non resident Tax File Number Advice."

I know my visa is temporary for 5 years but why are they classing me as a non resident? I checked on line and it means I will pay much more tax than normal when I get a job, plus our savings here in Oz will be taxed at the non resident rate.

On the governments tax website it says if you intend to stay permanently in Oz then you are classed as a resident for tax purposes - so why have they classed me as a non resident?

Is there anything I can do to avoid paying the higher tax rate on my earnings and savings??????

Thanks.

ABCDiamond

It should all work out correct with the end of year tax return, when your residence is defined correctly.

But, I suggest ringing the ATO, and getting it corrected now, for peace of mind.

Pollyana

I had the same issue on a Pro Marriage Visa - its all to do with it being a temp visa, and their system can't cope! I rang the ATO who told me to send the info back with the details of the visa I had, and they would correct it.The TFN stayed the same, they just changed the residential status. Only took a couple of weeks.

looky

I thought all people on a temp visa are taxed as resident come tax time?

I have had my TFN for 9 - 10 years now. I applied for it when I was on a temp visa, I am a PR now. Do I have to ring ATO about it? When I did my last tax, the accountant/finance person didn't mention anything in particular about any unusual or excess tax.

BTW I just checked my TFN letter and there isn't any non resident wordings on it at all, it just says TAX FILE NUMBER ADVICE as the title.

Add on: Just an update MRS KIWI as I just phoned ato. I was right about temp visa holder getting taxed by ato as a resident as long as you tick the 'resident for taxation purposes' on the tax return form. The problem is mainly with the employer rather than ato as your employer would withhold a a higher portion of your pay for tax incurred by non resident compared to resident. Update your employer about your visa status.

Pollyana

Don't know. As I arrived in November I wasn't inclined to pay non-resident tax for the best part of a year - simply couldn't afford it. I had to get it adjusted at once, before I lost a packet. Its all very well getting it back at the end of the tax year, but having arrived with virtually no money I needed the cash then, not several months later.

Sounds like yours is fine - it may have been right to start with, they may have adjusted it at the end of the year - either way if you are using an accountant I don't think you need worry

Alan Collett

And ... to complicate matters a tad further ... the OP is probably also a temporary tax resident with an exemption from tax in Australia on foreign source income:
http://www.ato.gov.au/individuals/co...tent/76537.htm

Best regards.

Mrs Kiwi

Thanks guys, I appreciate your advice.
I rang the ato and the guy said just to tick the resident box on my tax return at the end of June and it will all be sorted.
I hope to be working by then but if I'm not he said I could still file a NIL tax return so that I can tick the resident box.
He also said to explain to my employer that I am a resident for tax purposes and that should be ok.

I guess that all sounds ok as we are so near the end of the tax year if I do get a job soon I can suffer the huge tax deductions for a couple of months and claim it back at the end of June.

Alan, I looked up the link you posted re; tax exemption on foreign income and am confused - does that mean I am exempt from paying tax on my foreign income? To be honest, I shouldn't even be paying UK tax on it as the only foreign income I have is a rent on my UK house but after I've paid the mortgage the profit is so small that I am under the allowance for UK tax.

AAH - my head feels like it will explode!!

Thanks guys.

looky

If you only worked part year before doing the tax return you will get a huge tax refund

ABCDiamond

Not if he doesn't pay much tax (can't get back more than you put in )

Alan Collett

Feel able to contact me to discuss ... http://www.gomatilda.com/contact.cfm#ouroffices

You should be able to reach me by calling your nearest Go Matilda office.

Best regards.