ato logo
Search Suggestion:

Foreign resident withholding

Last updated 12 February 2019

Subdivision 12-FB of Schedule 1 to the Taxation Administration Act 1953 (TAA 1953) inserted a withholding event for payments made to foreign residents. Only payments prescribed in the Taxation Administration Regulations 1976 are subject to this withholding measure. Withholding applies to certain payment made to foreign residents for operating or promoting gaming junkets; entertainment or sports activities; construction and related activities.

Payers are required to withhold at the relevant rate prescribed in the appropriate regulation. We may grant a variation to the rate of withholding in special circumstances.

  • Foreign resident withholding does not affect other PAYG and non-resident withholding obligations on interest, dividend and royalty payments.
  • This withholding is not a final tax. These withholding requirements will not affect existing income tax obligations for foreign residents deriving assessable income in Australia, such as the requirement to lodge a tax return. Any amounts withheld may be available as a credit against the income tax assessed.

Gross income subject to foreign resident withholding will not be taken into account in determining the fund’s instalment income.

See also