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Employing Foreign Workers Overseas

Newbie

Views 4603

Replies 16

Hi,

 

If we employ an overseas worker eg. from Spain (non Australian Resident) to undertake work outside of Australia and they will not be coming to Australia do we need to withhold tax?

 

 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee

Replies 15

Hi @Alisynne,

 

Thanks for your patience while we checked in with our employer obligations unit.

 

There is no obligation to withhold from payments of salary or wages made to foreign residents where employment services are performed overseas, even if the business is considered to be an Australian residency for tax purposes.

Hope that helps!

16 REPLIES 16

Most helpful response

Devotee

Replies 15

Hi @Alisynne,

 

Thanks for your patience while we checked in with our employer obligations unit.

 

There is no obligation to withhold from payments of salary or wages made to foreign residents where employment services are performed overseas, even if the business is considered to be an Australian residency for tax purposes.

Hope that helps!

Initiate

Replies 9

Hi @AmandaE 

 

We are similarly considering engaging someone in the Philippines to do some work for us.  They will remain in the Philippines and work from there (and are not an Australian tax resident).  Based on your earlier response, it would seem there is no Australian PAYG withholding requirment.  I was hoping you could point me to some legislative reference or other ATO content, thanks.

Community Support

Replies 0

Hi @Piyush,

 

I’ll put a request through to our expert specialist area to see what we can find for you.

 

Luke S

Community Support

Replies 3

Hi @Piyush

 

Just touching base as to your query re:  employing overseas . I have included a link for Employing Australians overseas that by extension when applied to foreign non resident working outside Australia should assist your understanding.

 

Great to see your post and hope this helps

Kind regards

MarkA

 

 

Newbie

Replies 0

 

I'm new

Replies 1

Hi,

Just joining the conversation -

 

My client wants to know if they were to hire an employee overseas (non- Australian tax resident) and put them on their payroll, would they be expected to pay Super and withhold PAYG taxes? Additionally, how would we go about reporting this payroll figure in our BAS?

 

 

Thanks, Steve

Initiate

Replies 0

Steve

It would seem there is no need to pay super for non-resident employees for work done outside Australia (https://www.ato.gov.au/Business/Super-for-employers/Working-out-if-you-have-to-pay-super/) and in terms of payroll, you simply have to withhold at non-resident rates (if they have a TFN) or at 45% if they don't have a TFN.  And it gets reported same as other payroll. https://www.ato.gov.au/rates/weekly-tax-table/?page=7

Newbie

Replies 3

I am interested to hear from @Piyush whether he had any success in hiring overseas workers in the Philippines.  I have a client who also needs to hire workers in the Philippines for an online business with a base in the Philippines.

Newbie

Replies 2

My client is an Australian resident but not yet an Australian Citizen.  She started to set up an online business, in her own name, involving sales and the operation is based in the Philippines.  She will hire workers from the Philippines who will also perform the work there.  The workers will be paid wages.  My questions are:  being an Australian resident she would have to declare the overseas income in Australia, but does she have to register the business here or in the Philippines? or does she have to register in both countries?  Does she have to payg PAYG for the workers in the Philippines?  What are the bases of wage rate?  Is the wage rate based in the Philippines or in Australia?  Are the workers entitled to the same entitlement that Australians have?  What are her obligations as a business owner and employer in Australia and in the Philippines? Where do I go for information in Australia and in the Philippines?  I really appreciate your feedback.