Student Finances

Its that time of the year - Tax time is nearly upon us

by Sally L Watkins Tuesday June 22nd 2021

Its that time of the year - Tax time is nearly upon us-student-tax-return-time

As tax time nears, you should start to prepare your tax return.

It doesn't have to be stressful & we have put together information for you and how to do a tax return in Australia.

As an international student, you're probably familiar with the challenges of doing your international student tax return in Australia. If you're not, I'm about to tell you—it's more complicated than you think!

But don't worry, with a bit of preparation, you can take the stress out of tax time. In this post, I'll discuss some of the key things you need to know about doing your tax return in Australia.

Do your need to lodge a tax return?

That's right - most international students can get money back from their taxes.

How much do international students get taxed in Australia?

Student visa tax rate 2021 in Australia for students who work part-time in Australia pays an average 15.5% income tax on their earnings.

But, to be eligible, you have to meet a few requirements. You must be on a student visa and working 20 hours or less each week.

If you have been working while in Australia, you will likely need to lodge a tax return.

Suppose you are an international student studying for longer than six months. In that case, you will be considered as an Australian resident for tax purposes, meaning you have to declare your income on a tax return.

But in case you might not have to lodge a tax return check out, Do you need to lodge a tax return? on the Australian Tax Office website.

When do I have to do it?

Individuals can lodge tax returns is July 1 – October 31.

What do you need when completing your return?

  • Your tax file number (TFN). While international students don't need to have a Tax File Number (TFN), you do need one if working or opening a bank account. read more on applying for TFN here
  • A photo ID, e.g. a passport
  • Your PAYG Payment Summaries from your employer. Your employers should provide you with these details after June 30 and by July 14.
  • With the amount you've earned and the amount, you've been taxed. Your employer will send you the PAYG summary by mail or provide it online. You will need this information to fill out your tax form. Employers should give these to their employees.
  • Bank Statements: showing the interest you have received.

What Types of Income do I Include in my tax return?

When you file your tax return, you need to show all the taxable income you have received during the financial year. Taxable income can be generated from several sources and may include the following:

  • Wages and salaries as a part-time or casual employee.
  • Income from bank interest.
  • Bonuses and allowances.
  • Government allowances and payments, e.g. Austudy, Youth Allowance, Newstart Allowance, and more.
  • Gratuities and tips earned while working.

Here's how to file a tax return for international students in Australia

The Australian Taxation Office has a special section for international students. When you're completing your tax return, make sure you tick the 'international student' box.

If you have a scholarship, any money you received from the government (e.g. Austudy), or a dependent child, you can claim those on your tax return.

  1. Lodge your return online. Go to myTax on the ATO website. You will need to create a myGov account and then link it to the ATO. Then follow the instructions to fill out your return online.

  2. Use a registered tax agent. You can also Lodge your tax return with a registered tax agent to ensure you are getting the maximum rebate. Some agents deduct the amount they charge for their service directly from the tax return you claimed. That way, you do not need to hand them over the money. Ensure you only use a registered tax agent. Check out Tax Practitioners Board website.

  3. Use Tax Help. Run by trained volunteers to assist people on low incomes in doing their tax returns, the Tax Help program is a confidential service offered free to students to help you complete your tax return. Run by student volunteers, Tax Help staff are trained by the Australian Taxation Office (ATO) and must pass an accreditation test to become Tax Help volunteer but bear in mind they are not accountants. You can book an appointment for Tax Help directly through the ATO on 13 28 61 until October 31.

  4. Lodge a paper return

How long does it take to receive my return?

If lodging a tax return online, you will get your refund in about two weeks. By mail, it will take about six weeks.

Are there tax deductions International Students can claim?

You can reduce your total taxable income through deductions; in other words, you can claim for some expenses directly related to earning your income.

Deductions are basically of three types — self-education expenses, work-related deductions, and personal deductions. You can only claim these expenses if you have kept the relevant receipts, invoices, and bank statements.

Here are some of the most common forms of deductions you can claim:

  • Work-related phone and internet expenses.
  • Costs for compulsory work uniforms or protective clothing.
  • Vehicle and travel expenses between work sites. But does not include the costs of travel between work and home.
  • Home office running expenses. It incorporates the costs of everything, including printers, computers, furniture, heating, cooling, lighting, and more.
  • Work-related subscription and union fees.
  • You may also be able to claim work-related deductions for the cost of briefcases, tools of the trade, and calculators that cost less than $300.

Here is an international student tax return calculator Australia

ATO calculator

Income tax estimatorThis link opens in a new window – it will take between 15 and 25 minutes to use this calculator.

Simple tax calculations

Use the Simple tax calculator if you don't want or need a detailed calculation.