Changes To The Backpacker Tax

If you currently employ a working holiday maker on a 417 or 462 visa:

You must register with ATO by 31 January 2017 so you can withhold the correct amount tax.

From 1 January 2017, you should withhold 15% from every dollar earned up to $37,000 with foreign resident tax rates applying from $37,001.

If you employed a working holiday maker before and after 1 January 2017, you need to issue two payment summaries for this financial year

  • one for income earned up to 31 December 2016 (using code S)
  • one for income earned from 1 January 2017 (using code H).

If you don’t register, penalties may apply and you’ll need to withhold at the foreign resident tax rate of 32.5%

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