In the May 2015 budget, the Australian federal government introduced new laws requiring expats and non-residents, to report their worldwide income to the Australian taxation office.
The purpose of that was if the income exceeded the minimum HECS/HELP debt repayment thresholds of $54,869 (From 1st July 2019, the threshold has been reduced to $45,889), then a compulsory HECS/HELP debt repayment will be levied by the ATO.
You are obligated to report the income to the tax office if your income exceeds $13968 even though you don’t have to pay back any HECS/HELP debt.
You can report your income using ATO myGov’s facility or you can appoint us as your tax agent, and we can lodge an Australian tax return on your behalf
There are three methods to calculate your worldwide income
- Simple Method- Steps to calculate your worldwide income
- Add up all your worldwide income between 1st July- 30 June (convert that to AUD based on ATO forex rates) and add that to Australian sourced income (interest, dividends, capital gains etc)
- ATO works out the standard deduction based on occupation listed in the lodgement
Once the return is lodged, ATO will issue of Notice of overseas Levy that you will be required to pay
- Overseas Assessed method – Steps to calculate your worldwide income
- Take the taxable income from your foreign tax return and convert that into Australian dollar
- Add that figure to Australian sourced income if any
- Report that income to the ATO
There are some limitations to this method like you did not receive a tax assessment from foreign tax authority, you received multiple assessment from different tax authorities.
- Comprehensive method: Steps to calculate your worldwide income
- Add up all your worldwide income between 1st July- 30 June (convert that to AUD based on ATO forex rates) and add that to Australian sourced income (interest, dividends, capital gains etc)
- Add up all allowable deductions similar to how you would complete and Australian tax return. You need to keep all receipts and calculations
- Subtract Deductions from income and report that in your tax return
Contact us if you want us to prepare and report your income for HELP debt