ato logo
Search Suggestion:

Exempt foreign employment income

Last updated 14 November 2023

Any amount you pay to an employee that is exempt foreign employment income must be reported as exempt foreign employment income.

You must report these amounts even if they are the only income paid to the employee for the financial year. This is a new reporting requirement for STP Phase 2. It was not required to be reported under previous reporting phases such as STP Phase 1 or payment summaries.

If the employee’s foreign service qualifies as exempt foreign income, it is not subject to withholding and must be reported in STP Phase 2 against the income type SAW as exempt foreign income.

Exempt foreign employment income is the exception to the reporting of pre-sacrificed amounts. You must only report post-sacrifice amounts as exempt foreign employment income, and you must not report any amount sacrificed from exempt foreign employment income as salary sacrifice in your STP report.

If the employee’s foreign service does not qualify as exempt foreign income, it must be reported against the income type FEI.