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Non-resident Withholding tax (term deposit)

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I'm new

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Hi, I'm new here and appreciate if someone can advise on my Oz term deposit withholding tax question. I have a few term deposits with 2 banks and recently I noticed one with Westpac has taxed me more than 10% on interest earned. I had always been taxed only 10% on my interest earned for the deposits with the other Oz bank so I dont understand this. 

Im a Singaporean and not residing in Oz. Had tried calling Westpac but not useful/helpful at all cos they said my mobile numbers had changed to the Spore one which doesnt match their record and had suspended my phone banking access, so they cant help me at all. Tried approaching Westpac Spore office but they said they are not linked to any Oz accounts. Am in a fix here. Appreciate any help. Thanks!

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ATO Certified

Devotee

Replies 2

Hi @CC1378,

 

Thanks for getting in touch! On the tax side of things, if you've provided your bank with your TFN and advised you're a non-resident, they'll withhold tax at a rate of 10% if your country doesn't have a tax treaty with Australia.

 

If you haven't provided your bank with your current overseas address, they may withhold tax at the higher rate of 47%.

 

If you're dissatisfied with the service you've received from your bank, it's best to discuss the matter with them. MoneySmart has some great advice on how to approach your bank, as well as some sample templates to help you lodge a complaint in writing. You can also ask your bank about their formal complaints processes - all Australian banks should provide you with a facility to complain about their services.

 

If you're still experiencing an issue after contacting your bank, the Financial ombudsman service Australia may be able to provide some additional support.

 

Hope that helps!

3 REPLIES 3
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Best answer

ATO Certified

Devotee

Replies 2

Hi @CC1378,

 

Thanks for getting in touch! On the tax side of things, if you've provided your bank with your TFN and advised you're a non-resident, they'll withhold tax at a rate of 10% if your country doesn't have a tax treaty with Australia.

 

If you haven't provided your bank with your current overseas address, they may withhold tax at the higher rate of 47%.

 

If you're dissatisfied with the service you've received from your bank, it's best to discuss the matter with them. MoneySmart has some great advice on how to approach your bank, as well as some sample templates to help you lodge a complaint in writing. You can also ask your bank about their formal complaints processes - all Australian banks should provide you with a facility to complain about their services.

 

If you're still experiencing an issue after contacting your bank, the Financial ombudsman service Australia may be able to provide some additional support.

 

Hope that helps!

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Newbie

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Hi @AmandaE 

My mum she is a foreign & non-resident in Australia for tax purpose. She got some interest income at bank (AU) with 10% tax withheld (being correctly withheld from interest earned). Normally as a non-resident, she does not need to include the interest income in the tax return as the net amount is non-assessable non-exempt income. However, she got some tax losses (rental losses) in this and last financial years, and has interest income at bank (& has NO other income).

 

I am wondering is she entitled to claim the 10% withholding tax back by including the interest details in the tax return, given that she has tax losses?

Thanks for your help!

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Community Support

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Hi @00seven

 

We appreciate your contact .Your Mum is certainly welcome to report the interest and withholding in the return. It then can be accessed in establishing  the overall tax outcome.

 

All the best

MarkATO