Foreign Resident and tax free threshold

Question

Hi there,&nbsp;Hope everyone is well!&nbsp;I have an employee who on their TFN declaration form has indicated they are Foreign Resident for tax purposes, and they have also ticked YES to claiming the tax free threshold. I thought you could not claim the TFT if you are a foreign resident, but reading the question more closely, it reads&nbsp;Answer no here if you are a foreign resident or working holidaymaker, except if you are a foreign resident in receipt of anAustralian Government pension or allowance.&nbsp;My question is, which option should I choose in MYOB.&nbsp;Tax Free ThresholdorForeign Resident.&nbsp;I can't find one that includes both.&nbsp; I am thinking I should use Tax Free Threshold, but I am not 100% sure&nbsp;ThankyouNajjie

gavin12345 · Answer

Hi CathG&nbsp;&nbsp;If the employee is a foreign resident, use that tax table. There are a few exceptions but unless the employee provides this extra information, you should use Foreign Resident.&nbsp;From an Payer point of view better to withhold too much than not enough. Employee will get any excess back when they lodge their tax return.&nbsp;&nbsp;RegardsGavin

sam_r · Answer

Hi&nbsp;Najjie,
&nbsp;
Thank you for your post and hope you are well too!
&nbsp;
As this is deemed 'financial advice', we are unable to advise which tax table needs to be selected for your employees. I would highly suggest speaking with the ATO to confirm your query, however, there may be a member of this community forum that has had the same situation that may be able to shed some light for you.&nbsp;
&nbsp;
If you have any further queries in regards to your software, please reach out.&nbsp;

cathg · Answer

Hi NajjieDid someone else come back to you with your question regarding an employee ticking the "A foreign resident for tax purposes" and the Tax Free Threshold?As the same has happened with our new employee and I don't know if he should be in&nbsp; a tax free threshold category.Could someone please reply?Kind regardsCathy&nbsp;

cathg · Answer

Thanks GavinYes, it is probably better to withhold too much.The person is on a Partner Visa, Unrestricted, Full Work Rights.So I still don't know so am going to contact our Accountant to see if they can shed some light on it.Thanks for your reply.CathG&nbsp;

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Foreign Resident and tax free threshold

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