What is a tax file number (TFN) in Australia? Do international students need a TFN?
A tax file number (TFN) is a unique identification number that is issued to individuals and businesses by the Australian Taxation Office (ATO). It is used to identify taxpayers and their tax affairs. You will need a TFN to work in Australia and to pay tax. It is also used to track your superannuation (pension) contributions. You may also need a TFN to open a bank account, apply for a loan, or claim certain government benefits.
International students who are studying in Australia on a student visa may need to apply for a TFN if they plan to work while they are in the country. Even if you are not required to pay tax in Australia because you are an international student, you may still need a TFN to be able to work. You can apply for a TFN online through the ATO’s website or by completing a paper application form. You’ll receive your TFN on a paper mail. Therefore, you’ll need to provide proper address while registering for your TFN.
This is one of the fist things you need to do after coming to Australia if you’re planning to work here. There might be a confusion when we get asked the question “Are you an Australian resident for taxation purpose?”. The answer here is “Yes” even if we don’t have permanent residency in Australia or are not Australian citizens.
You’ll need to keep your TFN safe even if you’re not planning to stay in Australia as you’ll only have one TFN for your lifetime for Australia. You’ll need this TFN if you’ll need to come back to Australia and work. Moreover, TFN might be misused by fraud people if not kept safe.
Tax thresholds
Do internal students need to pay income tax? — Everyone (including international students)need to pay income tax in Australia. These taxes are deducted when anyone gets paid. However, depending on the threshold, we’ll get a tax return during the end/after the financial year.
In Australia, tax is paid on income above a certain threshold. The tax-free threshold is the amount of income that you can earn before you have to pay income tax. For the 2022–2023 financial year, the tax-free threshold is $18,200 for residents of Australia. This means that if you earn less than $18,200 in a year, you do not have to pay income tax.
The tax rates for residents of Australia are progressive, which means that the more you earn, the higher your tax rate will be. The tax rates for the 2022–2023 financial year are as follows:
- 0% for taxable income up to $18,200
- 19% for taxable income between $18,201 and $45,000
- 32.5% for taxable income between $45,001 and $120,000
- 37% for taxable income between $120,001 and $180,000
- 45% for taxable income over $180,000
It’s important to note that these tax rates and thresholds are subject to change, so it’s a good idea to check the ATO website for the most up-to-date information.
