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All You Need to Know TFN (Tax File Number) As An International Student

Tax File Number

International students in Australia can work part-time up to 40 hours per two weeks with certain restrictions. In Australia, when one is employed or wants to work they have to get a Tax File Number which acts as an individual’s nine digit personal reference number that are used during employment and while accessing superannuation funds. 

Although not compulsory, it is useful as TFN can help to arrange different financial activities and evade mandatory tax collections at higher percentages. Applying for a TFN is not an intricate process and one can apply either online or through participating Australian Post offices or the ATO.

With a TFN, individuals have less trouble as they may still face them without the number due to high tax deductions and other issues such but not limited like filing income taxes or applying for Australia Business Number (ABN) when starting a business. 

In case of losing a TFN, it is necessary to inform the issuing authority as soon as possible. TFN application is free of charge and once applied for the ATO issues this within 28 days. 

If an individual fails to provide his or her TFN, then the withholding rate will be much higher.

Some schools, non-government organizations and pensioners who are above 80 years of age fall under the exemptions from TFN withholding. In summary, international students wanting to work part time in Australia should apply for a TFN as it would make their financial transactions much easier by lowering the tax deductions and simplifying yearly tax returns.

How to Apply For TFN?

Before we get into the documentation process or application criteria of the TFN, it is important to gain an understanding on who truly is eligible to apply for the same.

Foreign passport holders who are permanent residents of Australia, as well as temporary visitors, are eligible to apply for a Tax File Number (TFN). Individual Auto Registration (IAR) is the name of the application process, which is free to do online on the official website.

To qualify for a Tax File Number TFN application, three key conditions must be met: 

  • The applicant should hold a foreign passport, be a permanent migrant or temporary visitor; 
  • They must currently reside in Australia and their visa category falls under one of those specified  categories such as a permanent resident’s visa to an overseas student, a visa with work rights, an overseas student visa, or a visa allowing indefinite stay in Australia (including New Zealanders automatically granted a visa on arrival)
  • A valid passport or relevant travel documents are required for the online IAR application, and individuals without a valid visa are ineligible to apply for a Tax File Number TFN.

How to Apply Tax File Number TFN For International Students In Australia?

Individuals residing outside Australia who earn income from an Australian source may find it necessaryto obtain a Tax File Number (TFN). This criteria is applicable for people overseas or outside of Australia and involves the following categories-

  • If you get income from an Australian source – any except for interest, dividends or royalties such as rental earnings;
  • If your spouse is an Australian resident applying for family tax benefit or child care subsidy
  • If you are a member of an Australian superannuation fund and anticipate receiving benefits or plan to make personal contributions, or if contributions are made on your behalf.
  • Finally, if you need to lodge an Australian tax return or apply for an Australian business number (ABN). 

When we attempt to find or retrieve the TFN, it is important to recognise whether you are classified as a foreign resident for tax purposes, the process to apply for a Tax File Number (TFN) involves completing a paper form titled “Tax file number – application or enquiry for individuals living outside Australia.”  

The fee for Tax File Number TFN applications are free for all applicants and this form can be downloaded from the official website. In case downloading is not feasible, you can order the form online or by calling 1300 720 092.

Once you have the form, you need to fill it out and send it along with certified copies of your proof of identity documents to the address specified on the form. 

It’s important to note that certified copies of your identity documents are required, and sending original documents is unnecessary, as they might not be returned. 

Upon receiving your completed application and the necessary documents, the processing time for issuing your TFN is approximately 28 days. This ensures that you can obtain your Tax File Number TFN efficiently for tax-related matters while residing as a foreign individual.

What to Tick in The Tax File Number TFN Declaration Form For International Students?

The employment form typically consists of two sections: First Section or Section A by the employee, while the second form or Section B by the employer. On the other hand, for an employee who is to fill out such a form it would be crucial for him or her to possess some information clear in identifying his/her payment which may range from how they are paid based on their status,ie, permanent employees, part-timers and casual workers. Employees must confirm this information with employers before filling out the form. If filling out the form by hand, all text should be in BLOCK LETTERS utilizing a black or blue pen.

First, there are multiple questions on the form. Question 1 asks about the Tax File Number (TFN). While Questions 2 through 6 ask for personal information, Question 7 asks you to choose and indicate the best payment method. Question 8 asks about the person’s tax residency status, requiring a differentiation between foreign students, working vacationers, and Australian residents for tax reasons. If they meet certain requirements, international students should check the box labeled “Australian resident for tax purposes.”

Also Read: Why Study Visa Rejection Number Increasing In the USA?

Question 9 concerns the claim of the tax-free threshold—the annual income below which an individual is exempt from paying taxes Tax File Number. Generally speaking, a person may only claim this threshold once, and they cannot do so in the same employment again. Holders of a working holiday visa, who are subject to a different tax rate, should respond negatively. Except in the case of Australian citizens or individuals with particular financial commitments, the answer to Question 10, which inquires about government loans and debts, should normally be negative. 

Completing the form in accordance with Australian taxation regulations requires that you comprehend these questions and answer them truthfully.

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