Tax Residency & Obligations – Temporary Remote Work in Australia for NZ Employer

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(Newbie)Newbie

5 Mar 2025

Hello!

I'm struggling to understand my tax residency situation and whether I need to take any action, so I'm looking for advice and help on how this works.

My situation:

I'm currently based in Wellington, NZ, but moving to Melbourne, Australia, in a couple of weeks as my partner has a new job starting in April.
My NZ based employer (with no presence in Australia) has offered me the option to work remotely for them for up to three months while I look for a new job, settle in the area and still getting income the least.
To formalise the arrangement, they’ve asked me to resign as soon as I can and set a fixed last working date (max 3 months) rather than giving a traditional 4-week notice later.
They have advised me that because this is a temporary remote working arrangement and I remain an NZ employee, there should be no tax implications, therefore continue:
- Paying NZ tax.
- Accruing KiwiSaver contributions as usual.
- Getting paid into my NZ bank account and it's up to me to transfer funds to Australia.

The company does not want to set up an Australian payroll, as it would create compliance costs for them.

My Questions:

Do I need to update the ATO and/or IRD about my temporary work situation?
Would this affect my tax residency for the period I’m working remotely (before I get a new job and switch to an Australian employer)?
Are there any risks of being considered an Australian tax resident during this period?
Would I need to file any tax returns in Australia and/or New Zealand at the end of the financial year?
Are there any other tax or legal obligations I need to be aware of?
Will this impact me setting up an Australian bank account or registering for a TFN?
If I do need to update my tax residency, how do I go about it? Would this require a formal application, call, or email?

I want to ensure that I don’t get double-taxed or unknowingly trigger Australian tax residency during this period. Apologies as I have little knowledge in this space, so any guidance would be greatly appreciated!

Thanks in advance!

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BrookeATO

(Community Support)Community Support

19 Mar 2025

Hi @rohdcelj

Wow, lots of info here!

Let's break it down in the format you've asked 💪

But before I do, your tax residency is a big factor that will determine the answers to most of your questions. You'll need to work out what your tax residency is, which you can find out more about in our article.

Depends, if you're an Aussie tax resident, yes as you'll need to report all income from all sources (including overseas). If you're a foreign resident, you won't have to declare the income you receive from your New Zealand employer unless you have a government loan (HECS, AASL etc).
There are many things that can impact your tax residency, you can use our tax residency tool to help work out your tax residency status.
If you're an Aussie tax resident whilst you're employed by an overseas company, it just means you have to report that income on your tax return. It also means that your employer may have to withhold tax in their own country and Australia (you can apply for foreign income tax offset if you're double taxed), and they may have to pay you Super.
Depends on your residency status mentioned in 1.
Just be aware that your obligations may change when your tax residency does, so be conscious as you may change tax residency status throughout your employment. You might benefit from engaging with a Registered Tax Agent to look after you tax obligations whilst you find your feet.
Not directly, again, things may change if your tax residency changes.
You'll tell us whether you're a resident or not when you lodge your income tax return.

You could also read our article on remote working. It may help answer some future questions.

All the best and welcome to Australia 🦘

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ESC25L.AU

(Newbie)Newbie

15 June 2025

Hi BrookeATO,

Apologies rohdcelj for piggybacking on your post, but you've described my situation better than I could.

The only difference that I have is, I will be on a 461 Temporary visa, but as far as I understand I will be a tax resident for the year 2025-2026 regardless.

I would like to go deeper on this answer:

3 . If you're an Aussie tax resident whilst you're employed by an overseas company, it just means you have to report that income on your tax return. It also means that your employer may have to withhold tax in their own country and Australia (you can apply for foreign income tax offset if you're double taxed), and they may have to pay you Super.

What do you mean when you say "may"?, it sounds optional.

I can't find anywhere if my NZ employer is required to withhold taxes and pay superannuation or if its completely acceptable to keep working for my NZ employer receiving my salary in NZ and paying taxes to IRD whilst living in Australia.

Being an AU tax resident I would be declaring to ATO my NZ income and claiming tax credits on the NZ taxes.

Am I making sense of the multiple articles I've read?

Thanks!

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Tax Residency & Obligations – Temporary Remote Work in Australia for NZ Employer

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