Hey!
I have recently started working as a nanny 30-20h per week. The family pays directly into my bank account.
I am on the 417 WHV and I have a TFN.
i am confused about the taxes. I’m not gonna be earning more than 18,000. So I am not employed by the family, which means I am a solo trader and need a ABN right?
do I file a tax return? Can I as a backpacker get the free tax threshold.
Thankful for help!
You do not need an ABN if you are a sole-trader. You only need an ABN for you want to or if you earn over $75,000 per year and are required to register for GST.
Also, simply having an ABN does not mean you are a sole trader. If you are being paid by the hour, if you must follow the instructions of the family and if you provide no equipment or provisions for the baby sitting then you are probably a employee for tax purposes.
This said, there are ATO employees on this site giving the opposite advice to mine, such as at this link: https://community.ato.gov.au/s/question/a0J9s000000L3PR/p00175477. However, unless the ATO has made new public rulings in recent years, my advice is the correct advice, which you can read about at this link: https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/payg-withholding/in-detail/withholding-from-payments-to-household-employees and at this page https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/employees-treated-as--independent-contractor/difference-between-employees-and-independent-contractors
Backpackers on 417 and 426 Visas are not able to use the tax-free threshold of $18,200
You do not need an ABN if you are a sole-trader. You only need an ABN for you want to or if you earn over $75,000 per year and are required to register for GST.
Also, simply having an ABN does not mean you are a sole trader. If you are being paid by the hour, if you must follow the instructions of the family and if you provide no equipment or provisions for the baby sitting then you are probably a employee for tax purposes.
This said, there are ATO employees on this site giving the opposite advice to mine, such as at this link: https://community.ato.gov.au/s/question/a0J9s000000L3PR/p00175477. However, unless the ATO has made new public rulings in recent years, my advice is the correct advice, which you can read about at this link: https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/payg-withholding/in-detail/withholding-from-payments-to-household-employees and at this page https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/employees-treated-as--independent-contractor/difference-between-employees-and-independent-contractors
Backpackers on 417 and 426 Visas are not able to use the tax-free threshold of $18,200
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