Tax Question - PLEASE HELP: )

martriv on 10/01/2018 - 18:37
Last edited 10/01/2018 - 21:55 by 1 other user

Hi everyone,

This is the situation

I am in Aus on a 485 visa which expires in Feb 2018 and was granted to me back in 2016, before that I was an international student and graduated with a double degree. I have applied for PR but I won't receive an invite until after my current visa has expired which means I have to leave AUSSIE. My employer has offered me to pay me my wage as a contractor but I don't understand the legalities around it- would I require to set up an abn and a company somewhere else ? I am thinking of moving to London but travel around Europe and then long term go to the US or central America. I just wanna know if just setting up an abn is enough or who to ask for help. Tax accountants don't seem to know (atleast the 2 I have asked)

Thank you

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Comments

  • whooah1979 on 10/01/2018 - 18:39

    as a contractor but I don't understand the legalities around it- would I require to set up an abn

    you need an abn to invoice your client.

    • martriv on 10/01/2018 - 18:50

      Thanks !

  • sly on 10/01/2018 - 18:48

    I'm not fully qualify to answer as a tax consultant but from what I know:

    • You should have your TFN already as you're working
    • With your TFN you can apply for ABN and need to provide some documents
    • If you are paid more than $75,000 you need to apply for GST and report GST either monthly or quaterly
    • Lodge your tax return at the end of the financial year
    • martriv on 10/01/2018 - 18:50

      Thank you!!! I am gonna get 73k , I don't mind keeping the money in Aus as if I do get PR would love to come back !!

  • Smulder on 10/01/2018 - 19:40

    You do not need to set up a company. You can apply for an ABN in your capacity as an individual/sole trader.

    As you are a non-resident, the application process may be more involved, and you may need to provide proof of identity documents. However, if you have a TFN and include this on your ABN application, then you most likely won't need to provide POI documents.

    Once you receive your ABN, registered as an individual, you can invoice your former employer as a contractor, and they can then pay you. When you lodge your tax return, this income is included as business income, rather than salary and wages.

    Note that depending on the nature of the work, regardless of whether you are being paid as a contractor, the ATO may still consider you an employee if that is the true nature of your relationship with the other business. You should review the 'Personal Services Income' (PSI) rules on the ATO website.

    I have no experience with regard to 485 visas, so I can't offer any help in that regard.

    • martriv on 10/01/2018 - 22:23

      Thanks for your thoughts, I appreciate your help !!

    • martriv on 10/01/2018 - 22:40

      Btw - would this require me to lodge two tax returns at the end of the year ? One for the abn and one for my tfn?

      Also can I use my current bank account to get paid on that one ? Or would I have to set up an abn bank account ?

      Thanks x 10000

      • CheapskateQueen on 10/01/2018 - 22:50

        No you don't lodge 2 tax returns. You complete your normal individual return and include your sole trader business income.

        You do not need a separate bank account for your abn but it may be smart to have a specific account for your business income and expenses.

        You made a comment about leaving your money in Australia in a above. You don't need to leave your money/savings here if you leave. Just pay your taxes (declare your business income)

        • martriv on 11/01/2018 - 05:57

          Thanks!!! I appreciate your help !!

    • martriv on 11/01/2018 - 06:09

      PS I am having issues setting up an abn -

      https://imgur.com/PhHXW94

      Any suggestions?

      Thanks :)

      • Smulder on 11/01/2018 - 11:03

        You have answered 'No' to the question "Will your activities be carried out in Australia', which is why it got rejected. You can only apply for an ABN if you are carrying on business in Australia.

        Will you be in Australia when you are doing the contract work for the company? If so, you should answer yes.

        • martriv on 11/01/2018 - 11:26

          Problem is I won't be in Australia, it does let me apply for it if I select No to that question but yes to register for GST.

        • Smulder on 11/01/2018 - 11:39
          +1

          @martriv: What is the nature of the work that you are doing? For example, if you are providing IT services to the company from overseas, then you aren't really carrying on a business in Australia. You are carrying on a business in whatever country you are physically doing the work, and the Australian company is just engaging the services of an overseas business.

          In reality the work you are doing has no connection to Australia, and as such, you are not carrying on a business in Australia and do not need an ABN, as you are not an Australian business.

          You may need to register as a business in whatever country you do the work in. However, you would need to get tax advice from a professional in that country.

          You also would not include the income in your Australian tax return.

          Your situation is very complex, and it may require that you get specialized tax and legal advice.

          Also, DO NOT REGISTER FOR GST!!

        • martriv on 11/01/2018 - 11:47
          +1

          @Smulder: I am an IT business analyst - you are right. Thanks for all your help! Mad respect!

        • Smulder on 11/01/2018 - 11:50

          @martriv: No problem :)

  • Toons on 10/01/2018 - 19:42

    Have you tried asking intermediaries like Hays international.

    They are basically act as an intermediary so they can help with short term or fixed contact positions.

    They might just answer the majority of your questions without needing to sign up through them, they operate in the countries you mentioned too so could be worthwhile chat irrespective.

    • martriv on 10/01/2018 - 22:24

      Might try and give them a call but the issue is that I doubt my employer wants a third party involved. Thanks for the help

      • Toons on 11/01/2018 - 13:36

        The other obvious thing is to chat to your employer ask them if they temporarily extend your current agreement till your required to return.

        Also Speak to payroll, they may have they confused terminology with you they might just turn around and say yeah we have done this for others, all we need to do is this and this and sign these forms to make sure everyone is covered.

  • pndl on 10/01/2018 - 21:47

    You can speak to a contractor payroll company, who will handle all the paperwork for you, you become their employee, who bill out your services.
    http://www.cxcglobal.com.au/contractors/contractortype/
    https://www.payme.com.au/contractor-payroll/

    • martriv on 10/01/2018 - 22:24

      Thanks for the links

  • xyee on 10/01/2018 - 22:33

    I may be wrong, but you should be granted a bridging visa with your original entitlements until a decision on your PR has been made. Thus, you can reside and work lawfully as an employee if the original visa conditions permit it.

    • martriv on 10/01/2018 - 22:38

      No because it's only an expression of interest:(thanks

    • PissLUR on 11/01/2018 - 12:48

      no, you are wrong.

  • [Deactivated] on 10/01/2018 - 22:52

    Noooo…don't leave us!

    • martriv on 11/01/2018 - 05:56

      I have tried everything to stay :(

      • Scab on 11/01/2018 - 09:49
        +1

        You haven't tried everything, you could get married to an Australian citizen.

        And now with same-sex marriage, you have even more options.

        Or if you're female I'm happy to help you.

        • martriv on 11/01/2018 - 09:50

          hahaha so many people suggested that!! But I think it's morally wrong even though I have had a gf for the last two years. I am just hopeful that my 189 visa will be processed and it's just gonna be a long break.

          Ohh well - que sera sera.

        • Scab on 11/01/2018 - 09:52

          @martriv:

          But I think it's morally wrong

          This is Australia, we don't have morals unless it's subsidised through Centrelink.

          And I'm still willing to help if you look good in fishnet stockings.

        • martriv on 11/01/2018 - 09:56

          @Scab: hahahahahahaha what a scab ! :P

        • whooah1979 on 11/01/2018 - 10:06

          @martriv:

          I think it's morally wrong even though I have had a gf for the last two years.

          there is nothing morally wrong with marrying one's partner. it's good for the australian economy by creating jobs in that industry which may have a flow on effect to others.

        • Scab on 11/01/2018 - 10:09

          @whooah1979:

          Do you look good in fishnet stockings, I want to help the economy?

        • martriv on 11/01/2018 - 10:18
          +1

          @whooah1979: I think that there is too much interest from one side to be correct. But that is just me, I don't wanna be someone that stayed because of someone else but because of it's own merits.

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