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This information applies to MYOB AccountRight version 19. For later versions, see our help centre.
https://help.myob.com/wiki/x/XAjq
AccountRight Plus, Premier and Enterprise, Australia only
From 1 January 2017, tax rates will change for working holiday makers who are in Australia on a 417 or 462 visa (the 'backpacker tax').
Under this new tax scale, you should withhold 15% from every dollar earned by a working holiday maker up to $37,000 with foreign resident tax rates applying from $37,001. See the ATO for more details.
You should start withholding at these rates from the first pay run after 1 January 2017.
Registering with the ATO
If you currently employ, or are likely to employ working holiday makers, you must register by 31 January 2017 to avoid penalties. Register from the ATO website.
How to withhold the working holiday maker tax
Until we release an update containing the updated tax tables, you can use the Withholding Variation tax table set to 15% for working holiday makers earning $0-37,000. After the worker earns above $37,000 you can assign them the applicable Foreign Resident tax table.
Here's how to do it:
- Go to the Card File command centre and click Cards List.
- Click the Employee tab.
- Click the zoom arrow to open the employee's card.
- Click the Payroll Details tab then click Taxes.
- In the Tax Table field, select Withholding Variation.
- In the Withholding Variation Rate field, enter 15%.
- Click OK.
Repeat these steps for each working holiday maker you employ.
Important: You'll need to manually track your working holiday makers' gross earnings for the payroll year by running the Payroll Activity Summary report (Reports menu > Index to Reports > Payroll tab). Once a worker exceeds $37,000, repeat the above steps to assign the worker the applicable Foreign Resident tax table. Check with the ATO if you're unsure which tax table to assign.
FAQs
If you don't register for the working holiday maker tax, you must withhold the foreign resident tax rate of 32.5% for working holiday makers. Follow the steps in Setting a withholding variation to set this rate.
If you withhold 15% for working holiday makers without registering, you may be penalised by the ATO.
If you already employ working holiday makers in 2016 who will be paid with the new tax rate in 2017, you need to issue two payment summaries with different rates:
- July 1 - December 31 2016
- January 1 - June 30 2017
You must withhold 47% from payments to working holiday makers if:
- They have not provided you with their tax file number (TFN),
- have not claimed an exemption from quoting their TFN, or
- have not advised that they have applied for a TFN.