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Re: Tax income from a WHV to a Partner Visa

Newbie

Replies 1

Reading (c)(i) this to me indicates the WHM tax rates only apply if they are granted a Bridging Visa in relation to an application for a further 417/462 visa ( the visas described in paragraphs a and b)

 

AND

the decision is pending

AND 

the last visa they held was either a 417 or a 462.

 

     (c)  a bridging visa permitting the individual to work in Australia if:

                              (i)  the bridging visa was granted under the Migration Act 1958 in relation to an application for a visa of a kind described in paragraph (a) or (b); 

 

it stands to reason if they are granted a Bridging Visa in relation to an application for a visa NOT described in parapgraph a or b (eg a 190 or an 820 visa) then the WHM rates do not apply.  

Initiate

Replies 0

Hi,

 

thank  you for the comment.

 

Reading my reply some time after that I realise that it may  not have been expressed clearly, I do apologise.

 

I believe the only open conclusion is as you noted below, the Bridging visa will NOT attract WHV rates where the BV is granted NOT in relation to 417 and 462 visa.

 

 

Sometimes the BV is not valid until the WHV visa expired, however the sections noted only deal with the "grant" of the visa rather than when the BV comes into effect. I would be of the opinion that the once the BV is granted and its NOT in relation to 417 and 462 the WHV should NOT apply from that moment, rather than later the BV comes into "effect"

 

Thank you

 

 

 

ATO Certified Response

Former Community Support

Replies 1

Hello @Grazy86,

 

@SAFRATA and @Taxably have both provided correct information.

 

“We cannot assume the visa will be granted until it is granted, and we must assess the situation on the facts available at the time it occurs. So if a Bridging Visa is held, it means the only visa we know certain is the previously held visa. Under this reasoning, a taxpayer on a Bridging Visa, who previously held a 417 or 462 subclass visa (Working Holiday Maker) should continue to be taxed as a Working Holiday Maker, in accordance to part 3 and 4 of Schedule 7 of the Income Tax Rates Act 1986.”

 

“3A  Working holiday makers and working holiday taxable income

             (1)  An individual is a working holiday maker at a particular time if the individual holds at that time:

                     (a)  a Subclass 417 (Working Holiday) visa; or

                     (b)  a Subclass 462 (Work and Holiday) visa; or

                     (c)  a bridging visa permitting the individual to work in Australia if:

                              (i)  the bridging visa was granted under the Migration Act 1958 in relation to an application for a visa of a kind described in paragraph (a) or (b); and

                             (ii)  the Minister administering that Act is still to make a decision in relation to the application; and

                            (iii)  the most recent visa, other than a bridging visa, granted under that Act to the individual was a visa of a kind described in paragraph (a) or (b).

 

The key word here are "or", namely subpara (c)(i) "and/or" which means that the subpara (ii) and (iiI) are to be construed in isolation from subpara (i). In conclusion, if you are on 417 or 462 visa, you apply for another visa and you are granted a brdiging visa, you will still be taxed under the 15% on the first $37,000 and then as residents for tax purposes.”

 

Regards,

Luke S

Initiate

Replies 0

Hi Luke,

 

thank you for the reply. One reader has recently posted a question you may see in the thread.

 

My reply to the thread is also there as I believe my original answer was not entirely clear.

 

It also appears that your answer will only be correct where you have a taxpayer transition from WHV to WHV, otherwise the provisions of the legislation quoted earlier will not be met. I understand your point that " we don't know whether the visa will be granted and so the taxpayer should be assessed on the most recent visa held", but that's not what the legislation requires you to satisfy. The legislation requires in 3A (1) (c) that all the three (i) (ii) (iii) must be met at the same time, and where the application in realtion to which the BV has been granted is NOT one of the two visas  as listed in 3 A) 1) a) and b), then the WHV rate  cannot apply.  Can you please provide more reasoning and why the interpretation of the section 3) should be departed from? Many thanks