Working Holiday Makers (Backpackers) Taxes

From 1 January 2017 working holiday makers are subject to special tax rates.

By definition, working holiday makers are the holders visa subclasses 417 and 462 which are both temporary visas under the immigration rules.

Working holiday makers are taxed on a progressive tax scale without the benefit of a tax-free threshold.

Working holiday-makers tax rates 2021

Taxable IncomeTax Payable
0 to $45,00015%
$45,001 to $120,000$6,750 plus 32.5% of income $41,000
$120,001 to $180,000$31,125 plus 37% of income over $120,000
$180,000 and over$53,325 plus 45% of income over $180,000

Working holiday-makers tax rates 2022

Taxable IncomeTax Payable
0 to $45,00015%
$45,001 to $120,000$6,750 plus 32.5% of income $41,000
$120,001 to $180,000$31,125 plus 37% of income over $120,000
$180,000 and over$53,325 plus 45% of income over $180,000

Prior to 1 January 2017 WHMs were taxed according to the residency rules enabling them to be taxed as residents for tax purposes with full access to the tax free threshold.

Departing superannuation payments are also taxed, increased to 65% from 1 July 2017. See Departing Australia tax on superannuation payments

The Tax Office has detailed rules and tax obligations for working holiday makers here.

Legal Challenge to Backpacker Tax

[6 August 2020] Commissioner wins on appeal: The Full Federal Court has allowed an appeal by the Tax Office and reversed an October 2019 decision which found that the backpacker tax is in conflict with Australia’s treaty obligations.

As a result the tax position of backpackers remains as it was before the challenge.

The Court has upheld the special non-resident tax scale applying to backpackers and rejected arguments that it conflicts with Australia’s tax treaty obligations.

Working Holiday Makers’ Tax Rates 2018-19, 2019-20

Taxable IncomeTax Payable
0 to $37,00015%
$37,001 to $90,000$5,550 plus 32.5% of income over$37,000
$90,001 to $180,000$22,775 plus 37% of income over $90,000
$180,000 and over$56,075 plus 45% of income over $180,000

Working Holiday Makers’ Tax Rates 2017-18

Taxable IncomeTax Payable
0 to $37,00015%
$37,001 to $87,000$5,550 plus 32.5% of income over $37,000
$87,001 to $180,000$21,800 plus 37% of income over $87,000
$180,000 and over$56,210 plus 45% of income over $180,000

This page was last modified 2021-05-11