Accountancy in Australia

>> Withholding Taxes in Australia

There are several rules pertaining to transactions involving cross border interests. This includes the requirement to withhold tax from payments made to nonresidents which are in the form of interest, unfranked dividends (dividends where no company tax has been paid) and royalties. The rate of the withholding can range from nil to 30% depending upon whether a Double Tax Agreement exists between Australia and the country of residence of the recipient.

Interest

Subject to any tax treaty provisions, a final withholding tax of 10% applies to interest payments made to non-residents.

Royalties

Subject to any tax treaty provisions, a final withholding tax of 20% applies to royalty payments made to non-residents.

Dividends

Franked dividends are not subject to any withholding when paid to non-residents. Subject to any tax treaty provisions, a final withholding tax between 0% and 30% applies to unfranked dividends paid to non-residents. The rate of withholding is determined by the country of residence of the recipient of the unfranked dividend.


Latest version updated 31st October 2017

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