Changing residency status with the ATO

[BigM]

Hi everyone,

 

I have recently been granted Temporary Permanent Residency after applying for a spouse visa. I am now wondering if anyone has any information on how to inform the ATO of this....so that I don't have to pay the high tax rate that non-residents do (approx 28%) on my wages.

Is it automatic?

 

Thanks in advance for any information

[Rupert]

Your visa does not dictate your tax rate. Why were you paying non resident rates anyway? How long have you been here previously?

[BigM]

I have been here 3.5 years, I was originally on a working holiday visa and with every employer I had I ticked 'no' in the box that said 'are you a resident for tax purposes' when I filled in the tax form.

[Rupert]

I have been here 3.5 years, I was originally on a working holiday visa and with every employer I had I ticked 'no' in the box that said 'are you a resident for tax purposes' when I filled in the tax form.

 

OMG.

 

Out of interest, what visa have you been on since the WHV expired?

[Mongrel]

Illegal by tge sounds of it

[RockDr]

You should have been resident for tax purposes since you entered the country. You don't need to inform the ATO, just tick the right boxes when you do your tax return. And tell your employer that you're resident so they tax your appropriately.

 

Assuming you've been on legal work visas since the WHV expired (I'm guessing 457s), you may want to have a chat to a tax accountant to see if you can clear up the last few years you've used the wrong residency status.

[Rupert]

Illegal by tge sounds of it

 

What on earth do you mean by that? What does "tge" mean?

[BigM]

well I've been legal since I entered the country (thank you for the benefit of the doubt Mongrel), so just to clarify before I'm hung drawn and quartered, I was on a WHV which I extended to 2 years after completing seasonal work. I met my partner during this time and so when my WHV expired I lodged the partner visa and was granted the bridging visa which I was on until my temporary PR was granted last week.

 

RockDr I was advised by each company that I worked for including one employment agency that I wasnt permitted to declare myself resident as I officially wasnt one

 

I did wonder if I could get my current employer to resend the tax form that I gave them for this job again but this time tick the resident box

Edited April 20, 2013 by BigM

[Rupert]

well I've been legal since I entered the country (thank you for the benefit of the doubt Mongrel), so just to clarify before I'm hung drawn and quartered, I was on a WHV which I extended to 2 years after completing seasonal work. I met my partner during this time and so when my WHV expired I lodged the partner visa and was granted the bridging visa which I was on until my temporary PR was granted last week.

 

RockDr I was advised by each company that I worked for including one employment agency that I wasnt permitted to declare myself resident as I officially wasnt one

 

I did wonder if I could get my current employer to resend the tax form that I gave them for this job again but this time tick the resident box

 

Hey you are not about to get hung drawn and quartered! One daft comment from one poster that I couldn't even understand as you will see from my post.

 

My earlier OMG was about the fact that you appear to have been paying way, waaay WAAAY too much tax for the last 3.5 years. Of course you were almost certainly tax resident all along. You should talk to your payroll department to get the right box ticked so to speak and then engage a tax accountant to get your overpaid tax clawed back.

[BigM]

Sorry Rupert that comment was directed at Mongrels post.

 

Think I will discuss this with payroll on monday and will ask the tax agent about it when I lodge my first tax return (I was told by a tax accountant that I couldnt put in a tax return until I was PR)

 

Do you know if I will get any of this overpayment back?

[BigM]

I mean if I will get the overpayment back just from doing a tax return

[Rupert]

For sure you will get your tax back, one thing you can say about tax departments, they are consistent. They will always pursue you for what is owed but they will also pay back what they owe you. You can get this years overpayment back via completing a tax return but not previous years. And find a different accountant, not one who thinks that your tax status is dependent upon having a PR visa.

[BigM]

ok cool, I will definitely seek some professional help with this and get it cleared up asap.

 

Thanks for all the advice

[bma]

Sorry Rupert that comment was directed at Mongrels post.

 

Think I will discuss this with payroll on monday and will ask the tax agent about it when I lodge my first tax return (I was told by a tax accountant that I couldnt put in a tax return until I was PR)

 

Do you know if I will get any of this overpayment back?

 

Ditch that tax accountant who told you that you can't lodge your tax return until you're a PR. What nonsense, these "professionals" should be responsible for their bad advices.

 

I do my tax return myself, but the stories I hear from my co-workers who pay to get their tax return done.... So many wrong advice and really basic ones, from not naming a spouse as dependent for tax purposes (saying it can't be done, but it's not true), to not claiming work-related deductions (saying that can't be claimed, not true), if I name just a couple most common ones... And my co-workers pay a lot of money to those tax accountants doing their tax return; unbelievable, really. :mad:

[ABL275]

Hi Big M,

 

Speaking as an accountant (zzzZZZZZZZ) what you've actually paid in tax and what you should have paid in tax are two completely different things - it sounds have if you may have been paying way too much tax for a long time so find yourself an accountant ASAP and sort it out.

 

You can normally go back 6 years or more in most cases so its not too late sort it out. Yes, you should be able to get a repayment.

[BigM]

Thanks bma and ABL275 I'm going to make an appointment with a tax accountant next week who came highly recommended (reasonable price but very thorough) so will hopefully have this issue sorted soon

[kubby]

What on earth do you mean by that? What does "tge" mean?

 

Ha ha ha !!.. TGE is "Misspelling of 'the'" :ssign18:

[Alan Collett]

(I was told by a tax accountant that I couldnt put in a tax return until I was PR)

 

If you have had a Tax File Number you should have been lodging an Australian tax return from the tax year in which you arrived.

 

Make sure you have your PAYG Payment Summaries (also known as Group Certificates) - you may well be due a tax repayment for each year.

 

Best regards.

[wrussell]

If you have failed to lodge returns and the ATO owe you, they will not do much except refund what they owe you.

 

If you owe them its the boiling oil and the hot irons.

 

Phone them and ask them to send you the relevant forms.

 

Keep copies of everything.

 

I recall, some years ago, being 13 years in arrerars, so I complete all the returns for which they owed me, followed by the ones where I owed them which I had the money to pay having received refunds.

 

I then had to object to the penalty notice, which I successfully did by blaming the immigration department for illegally cancelling my family's visas.

 

The ATO does not want to hear explanations unless they issue a penalty notice. From what you have posted this is unlikely in your case.

 

Unlike the DIAC, the ATO do not crucify you for an honest error and they will accept reasonable estimates. If you are not sure give them the facts and ask for a ruling.

 

Have fun, its only money.

Edited April 23, 2013 by wrussell
spelling

[Alan Collett]

Hi Westly.

 

Probably no need to ask for paper forms - I'd be lodging the tax returns electronically.

 

I doubt the ATO will be too bothered about a late lodged tax return; they might issue a letter saying don't be late again, but I find them fairly forgiving - unlike our HM Revenue friends in the UK ...

 

Best regards.

[wrussell]

Details of one million Australian visa holders will be compared with tax office records in a data-matching investigation targeting fraud and tax law breaches.

The Australian Tax Office has announced it will seek and collect names and addresses and other details of the holders of 27 types of visas, including skilled workers under the contentious 457 program and students.

The Department of Immigration and Citizenship will provide the details for the 2012, 2013 and 2014 income years.

"These will be electronically matched and analysed with certain sections of ATO data holdings to identify potential fraud, and other non compliance with lodgment and payment obligations under taxation law," the ATO said in a notice in the government gazette.

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"Records relating to approximately 1,000,000 individuals who were granted visas under the above subclasses will be matched.

"The ATO may also provide information to assist the Department of Immigration and Citizenship to maintain the integrity of the student and temporary working visa programs. The ATO is legally able to provide this information."

The data exchange will include all international travel movements undertaken by the visa holder, the listed educational institution where the person intends to study; information about immigration agents who helped process the visa; and any visa cancellation information.

The ATO wants to hold onto the data for three years, which is longer than suggested in the Australian Information Commissioner's data-matching guidelines, arguing the extension is needed because some types of visas span a number of tax years.

Immigration Minister Brendan O'Connor's spokeswoman said the data-matching program was ''not a specific crackdown'' but showed the government was working ''to ensure that locals are not missing out on work opportunities to visitors who do not have the correct work rights''.

According to the formal notice, the data-matching program will allow the ATO to investigate and reduce threats of non-compliance and fraud.

The ATO will also be able to "develop and implement administrative strategies to improve voluntary compliance and address the identified risks posed by temporary working visa holders and employer sponsors".