Australia – Immigration Updates

  • Taxation Changes for Holders of Working Holiday Visas
  • Changes in Education Costs for Holders of 457 Visas in South Australia
  • Entrepreneur Visa Introduced

 Taxation Changes for Holders of Working Holiday Visas

What has changed

The Australian Government has proposed taxation reforms which will effect holders of Work and Holiday (subclass 462), and Working Holiday (subclass 417) visas and employers of these visa holders. These changes are scheduled for January 1, 2017.

Who is affected?

  • Work and Holiday (subclass 462) visa holders, Working Holiday (subclass 417) visa holders, and employers of these visa holders.

What to expect

The rate of taxation for holders of these visas will be reduced and their Visa Application Charge will be reduced from A$440 to A$390. Employers of these visa holders will  have to register with the Australian Taxation Office and they will also be able to employ the visa holders in different regions of Australia for a total of twelve (12) months across the country, while still only being able to employ them for a maximum of six (6) months in a single location. For example, under the current arrangements, the holder of one of these visas may only work for a single employer for a period of six (6) months in total and they would be in breach of their visa if they worked for the same employer in two (2) locations for a period of more than six (6) months in total. Under these changes they may work for up to six (6) months for the same employer in different regions.

The rate of taxation will be reduced from the current 32.5% to 19% on the first $37,000 of earnings.

To offset the reduction in tax collected, the Government will also be increasing the taxation on superannuation payments to 95% and will increase the Passenger Movement Charge by $5 from July 1, 2017. The former of these changes effectively means superannuation payments are forfeited.

What you need to do
Planning ahead

  • Employers in Australia who do employ holders of these visas should note in particular the requirement to register with the Australian Taxation Office
  • Contact your Emigra Worldwide attorney or representative for further details on how these updates may impact you or your client.

Changes in Education Costs for Holders of 457 Visas in South Australia

What has changed

The Government of the State of South Australia has announced that a contribution fee will be introduced for holders of the most commonly-used Australian work visa, the Temporary Work (Skilled) Visa Subclass 457, who enroll children in Government schools in that state. From January 2017, newly-arriving holders of 457 visas will need to pay an annual contribution when enrolling their children in Government schools in South Australia. From January 2018, this will be expanded to include all 457 holders.

Who is affected?

  • 457 visa holders with school-aged children in South Australia

What to expect

While there is no impact on visa processing or visa conditions, employers who sponsor 457 visa holders to work in the state of South Australia should note this additional expense. The amount of contribution will be A$5,100 for primary school and A$6,100 for secondary (high) school. However, the contribution will be means-tested, so that the contribution may be waived if the gross family income does not exceed A$57,000. There is also a reduced contribution where the gross family income is below A$77,000 and this threshold rises by $10,000 for each additional child with a 10% discount applied where multiple children are attending schools.

The change aligns South Australia with other states, including the most populated, New South Wales, as well as Western Australia and the Australian Capital Territory.

What you need to do
Planning ahead

  • Employers who sponsor 457 visa holders to work in the state of South Australia should note this additional expense.
  • Contact your Emigra Worldwide attorney or representative for further details on how these updates may impact you or your client.

Entrepreneur Visa Introduced

What has change

A new Entrepreneur Visa has been introduced within Australia’s Business Innovation and Investment Visa Program.

The visa will allow for foreign entrepreneurs under the age of fifty-five (55) with competent-level English who intend to commence a “complying entrepreneur activity” to seek an invitation to apply for the Business Innovation and Investment (Provisional) (subclass 188) visa.

Who is affected?

  • Foreign entrepreneurs

What to expect

Prospective applicants need to demonstrate at least A$200,000 of funding, have at least a 30% stake in the proposed venture and be nominated by a State or Territory Government. There are restrictions around the source of investment and there are exclusions for ventures involving residential real estate, labour hire or purchase of existing businesses.

The Subclass 188 visa is a provisional visa issued for four (4) years and three (3) months, during which time the visa holder must maintain a relationship with their nominating State or Territory. There will be a pathway for the visa holders to then seek permanent residence after residing in Australia for at least two (2) years subject to the success of their venture as measured by turnover, job creation and ongoing financial backing.

The intention of the visa is to encourage entrepreneurs who will engage in activities which will lead to the commercialization of a product or service in Australia or the development of a business.

What you need to do
Planning ahead

  • Contact your Emigra Worldwide attorney or representative for further details on how these updates may impact you or your client.

The information above was provided by Emigra Worldwide, our global network partners, and relevant government authorities. The information herein is for general purposes only and not intended as advice for a particular matter. If you have any questions, please do not hesitate to contact the global immigration professional with whom you work.

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