Working Holiday Tax Return Australia (417 and 462) — FY2025-26 Guide
Working holiday makers on 417 and 462 visas are taxed under the special WHM regime regardless of how long they stay. This page covers the flat 15% starting rate, why most backpackers are non-residents for tax, what you can and cannot claim, and the 65% DASP rate that applies when you leave Australia.
Working Holiday visas (subclass 417 and 462) are designed for short-term, mobile work, and the ATO mirrors that with a dedicated WHM tax regime. Once your employer registers as a WHM employer, every dollar you earn from that employer is taxed under the WHM schedule from the very first dollar. Even if you happen to satisfy a residency test through a long stay in one location, your work income is still taxed under the WHM rules — the regime overrides the standard resident progression for that income.
Most working holiday makers are also non-residents under the ATO's general residency tests because their stay is structured around moving between farms, hostels and seasonal jobs. Without a settled domicile, a fixed home or a stable workplace, the Resides Test usually fails and the 183-day test alone does not flip you to resident status if your usual place of abode remains overseas. This means non-employment income such as Australian bank interest is taxed at non-resident rates, which is something to factor in if you have substantial savings parked here.
Working holiday makers are not eligible for HECS-HELP, cannot access Medicare in most cases and are excluded from many low-income offsets such as LITO. Your employer still pays 12% Superannuation Guarantee, but when you leave Australia and lodge a DASP claim the taxed component of your super is taxed at 65% — the highest DASP rate in the system. Plan your departure timing and lodgement carefully to avoid surprises, especially if you switch between WHM and non-WHM visas during the same financial year.
Tax residency rules
Although the WHM tax schedule applies regardless of residency status for employment income, your residency still matters for non-employment income, deductions and offsets. Under the Resides Test, ATO Ruling TR 2023/1 makes clear that backpackers who move every few weeks between regional jobs, share houses and short-stay hostels generally do not reside in Australia in the ordinary sense, so the Resides Test fails. The Domicile Test reinforces this because your domicile of origin remains overseas and your stay in Australia is by its nature temporary. The 183-Day Test is the closest call: if you spend 183 days or more in Australia in the income year you are technically a resident under that test unless the Commissioner accepts that your usual place of abode is outside Australia and you have no intention to take up residence here — and for most backpackers exactly that exception applies. The Commonwealth Superannuation Test does not apply. The practical effect is that even a backpacker who works for ten months in Australia is typically a non-resident, with WHM tax rates on wages and non-resident rates on bank interest. If you settle in one town, sign a long lease and stay with the same employer for the whole year, the picture can change to resident — but the WHM schedule still applies to the wages from any employer registered as a WHM employer.
Applicable tax rates
The WHM tax schedule for FY2025-26 is: 15% from $0 to $45,000, 30% from $45,001 to $135,000, 37% from $135,001 to $190,000 and 45% above that. There is no tax-free threshold. Your employer must withhold 15% from the first dollar of pay if they have registered as a WHM employer with the ATO; if they have not, default non-resident withholding of 30% will apply and you will need to claim back the difference at tax time. The Medicare Levy does not apply because you cannot enrol in Medicare on a 417 or 462 visa. The Medicare Levy Surcharge therefore also does not apply. HECS-HELP loans are not available, so no compulsory repayment runs. On departure, DASP for WHM holders is taxed at 65% on the taxed element of the taxable component, which makes it especially important to consolidate any small accidental super accounts before you leave.
Common deductions
- 1Travel between two separate workplaces on the same day, such as moving from a morning farm shift to an afternoon hospitality job — keep dated rosters as evidence.
- 2Work clothing that is occupation-specific or compulsory uniforms with a logo, plus their cleaning, but not regular casual clothes worn on the job.
- 3Tools and equipment required for the job such as steel-cap boots, hi-vis vests, gloves, knives and harnesses, apportioned for private use where applicable.
- 4Sun protection items including sunscreen, hats and sunglasses where the work is genuinely outdoors for most of the day, with a reasonable apportionment for private use.
- 5Mobile phone and small data costs for the work-use portion only, evidenced by a four-week representative diary covering both shifts and admin.
- 6Tax agent fees paid in the previous financial year for preparing your last return, claimable in full in the year the fee is paid.
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Frequently asked questions
Am I a tax resident or non-resident on a 417 or 462 visa?
Most working holiday makers are non-residents because they move regularly between regions, jobs and accommodation. The Resides Test fails and the Domicile Test confirms your domicile is still overseas. Even if you are physically in Australia for 183 days or more, the Commissioner usually accepts that your usual place of abode remains overseas, so the 183-day test does not push you to resident. A backpacker who settles in one town and rents the same place for the whole year may become a resident, but their wage income still falls under the WHM tax schedule.
What is the working holiday maker tax rate?
WHM income is taxed at 15% from the first dollar up to $45,000, 30% from $45,001 to $135,000, 37% up to $190,000 and 45% beyond that. There is no $18,200 tax-free threshold. Your employer must register as a WHM employer with the ATO to apply 15%; if they do not, default non-resident withholding of 30% will apply. You can recover the difference when you lodge your tax return, so always confirm your employer's WHM registration before starting work.
Do I pay the Medicare Levy on a working holiday visa?
No. Working holiday visa holders cannot enrol in Medicare in Australia, so the 2% Medicare Levy does not apply and the Medicare Levy Surcharge is not added either. You should still consider private travel and health insurance because public hospital costs without Medicare or insurance can be very high. You do not need to apply for a Medicare Entitlement Statement, since the levy simply is not assessed on WHM income.
Can I claim HECS or self-education on a 417 visa?
No to HECS — the HECS-HELP loan scheme is restricted to citizens, permanent residents and a small number of humanitarian visa subclasses, and does not extend to 417 or 462 visa holders. Self-education is also tightly limited because most courses backpackers take are not connected to current Australian employment. The narrow exception is short courses that directly maintain the skills used in your current paid Australian role, for example a hospitality worker taking a paid responsible service of alcohol refresher.
How is my super taxed when I leave Australia as a backpacker?
Your employer pays 12% Superannuation Guarantee throughout your time in Australia, regardless of which visa you hold. When you leave permanently and your 417 or 462 visa is cancelled or expires, you submit a DASP application. For working holiday makers, the taxed component is taxed at 65%, far higher than the 35% rate for student or skilled visas. Apply within six months of departure for the simplest process. Consolidate any small accidental super funds first to avoid losing money to fund fees.
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