We are a registered company in Australia, one of our directors is non-resident, he will send invoice/s from his overseas company to us for director fee. Could you please let us know the tax treatment for his invoices?
Thanks
Hiya @Jenny24 👋
First and most importantly, Directors' Fees are mandatory to report via STP, regardless of the source document you use to identify the amount to pay.
As per the ATO tax tables, directors' fees are taxed as per salary and wages. If you have received the TFN Declaration, then that is where the payee identifies their tax residency and, if a Foreign Tax Resident, then the foreign resident tax rates apply.
As per the ATO SGR 2009/2 paragraph 40, directors' fees are OTE and super guarantee is payable.
They are separately identified in the STP2 Pay Event, as per the ATO STP2 Employer Guidance.
Deanne
Hiya @Jenny24 👋
First and most importantly, Directors' Fees are mandatory to report via STP, regardless of the source document you use to identify the amount to pay.
As per the ATO tax tables, directors' fees are taxed as per salary and wages. If you have received the TFN Declaration, then that is where the payee identifies their tax residency and, if a Foreign Tax Resident, then the foreign resident tax rates apply.
As per the ATO SGR 2009/2 paragraph 40, directors' fees are OTE and super guarantee is payable.
They are separately identified in the STP2 Pay Event, as per the ATO STP2 Employer Guidance.
Deanne
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