How to File Australian Business Taxes as an International Student
Many international students in Australia engage in part-time work, freelance projects, or small-scale businesses while studying. Whether you operate a side hustle, provide digital services, or run a registered business, you must understand how to file Australian business taxes properly to stay compliant and avoid penalties.
Quick Tip: Even if your income is small, you are still required to lodge a tax return if you earn any taxable income while in Australia.
1. Determine Your Tax Residency Status
The Australian Taxation Office (ATO) classifies individuals based on residency for tax purposes. Most international students are considered Australian residents for tax purposes if they stay more than six months and live in one place during their studies.
This classification affects your tax rates, deductions, and eligibility for tax-free thresholds.
2. Register for an ABN (Australian Business Number)
If you offer freelance services or run a business, you need an Australian Business Number (ABN). It identifies your business to the government and allows you to invoice legally. You can apply online for free and usually receive it within minutes.
3. Keep Accurate Financial Records
Record all income, invoices, and business expenses throughout the year. Common deductible expenses include internet costs, work tools, study-related items used for business, and subscriptions relevant to your work.
Maintaining a separate business bank account is highly recommended to simplify record keeping.
4. Understand Your Tax Obligations
- Business Income: All earnings from freelance or business activities must be declared in your tax return.
- Tax-Free Threshold: As a resident for tax purposes, you can earn up to AUD $18,200 before paying income tax.
- GST (Goods and Services Tax): Register for GST if your business income exceeds AUD $75,000 annually.
- BAS (Business Activity Statement): Required quarterly if you are registered for GST.
5. Lodging Your Tax Return
You can lodge your business tax return:
- Online through the myTax system via your myGov account.
- Through a registered tax agent who understands international student tax rules.
- By paper lodgment (less common but available).
The tax year runs from 1 July to 30 June, and the deadline for filing is usually 31 October.
6. Claiming Deductions
You can claim deductions for expenses directly related to earning your income. Examples include:
- Work-related equipment (laptop, software, printer, etc.)
- Home office costs if you work remotely
- Professional insurance and memberships
- Education or courses that improve your business skills
7. Penalties for Non-Compliance
Failure to lodge or misreporting income can lead to penalties and affect your visa status. The ATO is strict about compliance, and international students should ensure all information is accurate and submitted on time.
Important: Filing your taxes correctly shows good financial conduct, which can be useful for future visa renewals or permanent residency applications.
