Foreign employment income is income you earned as an Australian resident working overseas as an employee. It includes salary, wages, commissions, bonuses and allowances. It may be paid by an overseas or an Australian employer.
You must report all your foreign employment income in your Australian tax return, both assessable income and exempt income. You must do this even if tax was taken out in the country where you earned the income.
Do not include foreign employment income shown on a PAYG payment summary – foreign employment. In myTax, you show it at Foreign employment income in the Payment summaries section. If you can't see it, go to the Personalise return screen and select the following:
- 'You received salary, wages or other income on a payment summary, or Australian Government payments'.
- 'Foreign employment income (on a payment summary)'.
Exempt income
You may be exempt from paying tax on your foreign employment income if you're a member of an:
- Australian defence or police force
- organisation engaged in overseas aid work.
You must still report this exempt income in your tax return.
For more information about whether your foreign employment income is exempt income or not, see Part A – Foreign source income and foreign assets or property.
Note: If you are an Australian Government agency employee (and not a member of a disciplined force), include income earned from delivering Australian official development assistance (ODA) at Foreign employment income in the Payment summaries section. If you can't see the Foreign employment income section, go to the Personalise return screen and select the following:
- 'You received salary, wages or other income on a payment summary, or Australian Government payments'.
- 'Foreign employment income (on a payment summary)'.
Members of a disciplined force delivering ODA are still eligible for exemption. For more information, see Exempt foreign employment income.
Depreciation and capital allowances tool
You can use the Depreciation and capital allowances tool to work out any deductible decline in value or any balancing adjustments for assets associated with earning foreign employment income. To access the tool, select the 'Work it out' link in the Deductions section on the Prepare return screen.
Completing this section
You will need details of your foreign employment income - not on a payment summary - from each employer or payer.
- For each foreign employment income not on a payment summary, select Add, indicate the Type of payment and enter information into the corresponding fields.
Note: If you used the Depreciation and capital allowances tool, fields containing information from the tool cannot be directly adjusted in myTax. To make any adjustments to this information, or to add new assets to the tool, select Work it out. - If you indicate the type of payment is Exempt income
- select the Country employed in
- answer the question Does this include lump sum in arrears?
If Yes, enter the Lump sum in arrears amount and the required additional information (year and amount earned), and select Save. If the payment relates to more than one year, select Add and provide additional details.
The exempt income will not be included in your taxable income but will be used to determine the amount of tax, Medicare levy, Medicare levy surcharge (if applicable) and compulsory HELP, Financial Supplement, Student Start-up Loan, ABSTUDY Student Start-up Loan and Trade Support Loan repayments.
- Select Save.
- If you haven't already done so, answer the question During the year did you have an interest - direct or indirect - in overseas assets worth AUD$50,000 or more?
- Select Save and continue.