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Australia-United States Joint Space and Defence Projects

How employment income in connection with a joint space and defence project may qualify for special tax treatment.

Last updated 25 April 2023

Eligible projects

A joint space and defence project may qualify for special tax treatment.

If you receive income in connection with the following projects, you may qualify for special tax treatment:

  • North West Cape Naval Communication Station (Exmouth, Western Australia).
  • Joint Defence Space Research Facility (Pine Gap, Northern Territory).
  • Sparta Project.
  • Joint Defence Space Communications Station.
  • Force Posture Initiatives.

Project employment income

Under some circumstances, employment income for services at these facilities is exempt from Australian income tax if the same income is subject to tax in the United States. You will need to give us evidence such as a closing agreement with the US Internal Revenue ServiceExternal Link.

Foreign contractor income

Income a foreign contractor gets from services performed at these facilities may be exempt if the income is not exempt in the US.

However, if the foreign contractor is a US entity that doesn't pay tax (such as a limited liability company), the US tax treatment of the entity and its members will be considered when working out if the exemption applies.

This tax treatment doesn't apply to Australian citizens or residents of Australia for tax purposes.