Paying the ATO from Abroad

Matt Di Vincere (Chief Editor)
Last Edited Sep 12, 2022

As per the ATO’s foreign income of Australian resident working abroad, Australian residents who are defined as such for tax purposes must pay for their income regardless of where this income was generated in their income tax returns. These residents who have foreign income can apply for an income tax offset (case specific) but in any case all income globally must be included in their tax filing with no exceptions. All income must be reported in Australian Dollars as per ATO’s exchange rates.

Paying the ATO from Abroad Can Be Expensive

As per the ATO “BPAY or a credit or debit card are the fastest, easiest ways to pay the ATO” which is a problematic statement because

  1. If you work abroad and make your income overseas and are being paid in foreign currency, to pay via BPAY you will need to repatriate funds from abroad to your Australian bank account and it may be very costly. For example a wire transfer from USA via banks will cost $15-20 on average and then up to 5% in currency exchange markups.
  2. Similarly, if you are paying via debit or credit card denominated in a foreign currency from the USA or the UK, foreign exchange charges will be 2%-3% on top of normal card charges.

Both of those recommended options to pay ATO from abroad are costly and there are better ways to pay tax debt from overseas which are simply put, less costly but are still easy to execute.

Paying from Overseas with Ease

Our recommended way of moving large sums of money is detailed in this guide for sending large amounts of money abroad – specialist providers offering no-fees on international money transfers as well as much more competitive exchange rates than those offered by banks. These services are friendly, offer an easy online money transfer system, and even can help you fix rates for the future via a Forward Contract.

When it comes to making ATO payments specifically – OFX, one of the leading providers on our website, has a particular partnership with the ATO and is without doubt the most suitable options, as per the below:

Unlike with other providers, due to a strong partnership between publicly traded, Australia-headquartered, OFX and the ATO – they can allow direct debit payments which areย  directly reconciled with the consumerโ€™s unique โ€œPRNโ€ (Payment Reference Number).

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Paying The ATO From Abroad

Discover the tax obligations for Australians working overseas, highlighting potential high fees with ATOโ€™s suggested payment methods. The content recommends the efficient, cost-effective OFX for ATO payments from abroad, offering direct debit payments and seamless reconciliation using your PRN, making it an affordable, user-friendly solution for managing overseas tax obligations.