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Working Holiday Makers to be taxed at least 32.5% from 1 July 2016
From 1 July 2016, if you are in Australia on a working holiday visa, you will be taxed at 32.5% from the first dollar of income earned.
Previously, if you were in Australia for more than 6 months, you would have been able to be taxed as an Australian resident with the benefit of the tax free threshold and lower tax rates. A tax free threshold is a certain dollar benchmark where you do not have to pay tax, until you exceed it and then only pay tax on the amount over the benchmark of threshold, hence the name tax free threshold. The 32.5% tax rate would then only have kicked in when your individual taxable income or earnings exceeded $37,000.
So, if you are a working holiday maker, you need to be prepared to have your employer (including your recruitment agency) deduct more tax from your salary and wages from 1 July 2016.
Of course, if you require financial advice specific to your situation, please contact your financial advisor or Accountant.