Banking, tax and superannuation
Australia has a world-class, tightly regulated financial services industry overseen by the Australian Prudential Regulation Authority (APRA). It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry.
The Australian financial year runs from 1 July to 30 June.
Australia has four major banks, all of which have comprehensive migrant banking websites:
These banks offer dedicated services for people migrating to Australia, making it easy for you to organise your money before you arrive. Most Australian employers will only pay your salary directly into a nominated Australian bank account, so while you may wish to remain with your current bank, it is important to note that many overseas banks do not have branches in Australia.
There are many other financial institutions to choose from, all of which are worth assessing once you arrive in Tasmania.
The Australian Taxation Office (ATO) is the Australian Government’s primary revenue collection agency, levying most taxes which are imposed in Australia. Their role is to manage and shape tax, excise and superannuation systems that fund services for Australians.
A Goods and Services Tax (GST) applies, being a broad-based consumption tax charged at the rate of 10% on the sale of most goods and services. Income tax is charged to all workers at rates set by the ATO. The current income tax rates are available on the ATO website. All workers are required to lodge a tax return by the end of October for the previous financial year.
You will need to apply for a Tax File Number (TFN) through the ATO when you arrive in Australia. This is a unique number given to individuals which you should provide to your employer, superannuation fund and bank. If you do not have a TFN you may pay more tax than necessary, or not be able to get government benefits you are entitled to receive.
Only one TFN is issued to you for your lifetime, and it is important to keep it secure. Once your TFN has been issued, there is no need to re-apply if your circumstances change – for example; if you move interstate, change jobs, change your name, have investments, or claim government health benefits.
You can apply online for your TFN once you arrive in Australia. All that is required are your passport details and your Australian address. You will then receive your TFN approximately ten days later by mail.
There are also tax reporting requirements for Australian companies, with extensive information available on the ATO website.
The Australian superannuation system is based on an ‘income replacement’ model, aiming to provide individuals with a comfortable, self-funded retirement. The minimum compulsory superannuation contribution by your employer is 9 per cent of your income. You are able to make additional contributions to your super fund pre or post tax, with both options attracting various incentives.