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Foreign tax and foreign compulsory social security payments made on foreign income

Newbie

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Hi,

If someone were working overseas for a period and earned income overseas and paid tax and compulsory social insurance contributions, are some or all of the social insurance contributions considered tax paid in that country when performing the Australian Tax return?

The person is considered an Australian Resident for tax purposes.

The total of the contributions is 39.15% of gross salary and the taxable salary is calculated by reducing the gross by that amount for the tax return in that country.

 

The breakdown of the contributions is: 

  • sickness insurance: 7.65%
  • accident insurance: 1.2%
  • unemployment insurance: 6%
  • pension insurance: 22.8%
  • Chambour of Labour Contribution: 0.5%
  • housing construction promotion levy: 1%

 

Thanks for the advice

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Most helpful response

ATO Community Support

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Hi @Rob5 

 

Take a read through the information we have about foreign income tax . There is a section that lists foreign taxes that aren't included.

 

I also suggest getting in touch with our Early engagement team for clarity and further advice.

 

In addition if they are claiming an offset of more than $1000.00 they need to work out their foreign income tax offset limit. This may result in their tax offset being reduced to the limit. 

 

Thanks, Ari

1 REPLY 1

Most helpful response

ATO Community Support

Replies 0

Hi @Rob5 

 

Take a read through the information we have about foreign income tax . There is a section that lists foreign taxes that aren't included.

 

I also suggest getting in touch with our Early engagement team for clarity and further advice.

 

In addition if they are claiming an offset of more than $1000.00 they need to work out their foreign income tax offset limit. This may result in their tax offset being reduced to the limit. 

 

Thanks, Ari