Getting more tax refund for Backpacker Tax Return

Recently Australian Taxation Office had lost another major case on the tax resident, this follows from Glenn Harding Case in last month.

The outcome of the case would mean that Backpacker would be able to amend their prior years tax return and see whether they can get more tax refund back, as ATO might made a mistake in the processing of the return.

In order for the backpacker to understand how the backpacker tax return can get more tax refund, it is important to understand the case around the backpacker tax return of Catherine Abby.

This particular case is Andy V Commissioner of Taxation [2019] FCA 1768. On 30 October 2019, the Federal Court had overruled ATO’s decision , and formulated the view that Catherine Addy is tax resident, and subject to normal tax rate and tax free threshold.

Federal Court of Australia upheld the view that Addy is a tax resident, and meet the definition of the Tax Resident, as such she can enjoy the Australian Tax Resident tax rate, which is up to $18,200, there is no tax.

https://youtu.be/sYKNjgl5Enc

Catherine came to Australia in 2013, and for her FY2017 tax return, ATO ruled that she is subjected to Backpacker tax, which imposes 15 cents in a dollar for anything up to $37,000. After that, it is subject to a higher tax rate of a non-tax resident. She needs to pay around $2,767.95.

She then objected the decision with the tax agent’s help, in December 2017, ATO did an amendment, and ruled her as a tax resident, and gave her a refund of around $3010.
In February 2018, ATO overturned the amendment, saying that they still believe Addy is a non-tax resident, and subject to backpacker tax. Addy got mad, and through the help of her tax agent, they took ATO to the federal court and won the landmark case. The rationale behind the judgement is that Addy intends to reside in Australia, and she did not travel a lot during her stay, she usually stayed in Earlwood.

The decision from the Federal will affect 75,000 backpackers, and ATO is looking at refunding hundreds of millions of tax dollars to those backpackers. You could be the one, talk to us to find out whether you can amend your prior tax return to maximize tax refund for your prior year tax returns.

If you are a backpacker and had done the FY2017 tax return, please come and talk to us, and we will help you to speak with ATO to see whether you are eligible to get the refund from ATO due to the correction. Please give us a call on 0410-829-900, or email us to jc@endurego.com.

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