Tax Tips for Aussies on a UK Working Holiday: What You Need to Know Before You Go
🌍 Tax Tips for Young Australians on a Working Holiday (UK and Beyond)
Planning a UK working holiday or heading overseas for a year of travel and work? It’s an incredible adventure — new jobs, new places, and new experiences. But before you go, it’s worth getting your head around your tax obligations — both in Australia and overseas.
At Dawson Accounting, we help young Australians make sense of tax rules before, during, and after working holidays. Here’s what you need to know:
🧭 Are You Still an Australian Tax Resident While on a Working Holiday?
This is probably the most confusing — but also the most important — part of the tax puzzle when going overseas.
Even if you’re planning to live and work abroad for a while, the ATO might still treat you as an Australian tax resident. And that means you’ll need to declare all your worldwide income, including anything you earn overseas.
So how do you know if you’re still a resident for tax purposes?
The ATO looks at a few key things to figure it out:
🔁 Are you planning to return to Australia?
If your overseas trip is temporary — like a 12 or 24 month working holiday — and you intend to come home, the ATO will usually consider you an Australian tax resident.
🏠 Do you still have connections to Australia?
Even while you’re away, the ATO will consider whether you’ve kept ties to Australia, such as:
A home or rental lease here
Australian bank accounts
A super fund
Health insurance, phone plans, or ongoing subscriptions
Close family or personal relationships
✈️ How permanent is your move?
If you’re only heading off for a working holiday and not settling down overseas long term, the ATO will likely treat you as an Australian resident for tax purposes.
If you cut most of your ties to Australia and build a new life overseas, they might consider you a non-resident.
⚖️ Why tax residency matters:
If you're an Australian tax resident, you:
Need to lodge a tax return each year
Declare all your income (Australian + overseas)
Can access the tax-free threshold (first $18,200 tax-free)
May be eligible for foreign income tax offsets
If you're a non-resident, you:
Only report your Australian-sourced income
Don’t get the tax-free threshold
May pay higher tax on Australian income
🧾 Example:
Jess goes to the UK for 12 months on a working holiday visa. She keeps her Australian bank accounts and super, has a return flight booked, and plans to move back in a year. The ATO still considers her an Australian tax resident — so she’ll need to include her UK income in her Australian tax return.
💬 Still not sure?
Tax residency can be a grey area. If you want peace of mind before you take off, we’re happy to help.
📅 Do You Still Need to Lodge an Australian Tax Return?
If you’re considered an Australian tax resident, then yes — you must lodge a tax return each financial year, even while living or working overseas.
You’ll need to:
Declare your overseas income in Australian dollars
Include any Aussie income (like rent or interest)
Possibly claim a foreign income tax offset if you’ve already paid tax in another country
If you become a non-resident, you may need to lodge a final return before you go.
🇬🇧 How Does Tax Work in the UK While You’re There?
If you’re on a UK working holiday visa, you may:
Pay UK income tax and National Insurance on your earnings
Need a National Insurance Number to work legally
Receive a payslip and possibly a P45 or P60 form when you leave a job
Every country has different rules — but most will tax you on the income you earn there.
💼 Can You Get a Tax Refund From the UK?
Yes — if you:
Leave the UK before the end of the tax year, or
Didn’t earn much during your stay...
You may be eligible for a UK tax refund.
Keep:
Payslips
Tax summaries (P45, P60)
Your UK bank account details
Keep in mind that the UK financial year starts on 6th April and ends on 5th April.
🏦 What Happens to Your Super While You’re Overseas?
You won’t be contributing to your Australian super while working overseas, but don’t forget about it entirely.
Helpful tips:
Keep your super account active and updated
Consolidate multiple funds to avoid extra fees
Nominate a beneficiary if you haven’t already
🚫 Don’t withdraw your super early — you’ll lose a chunk to tax and may regret it later.
📬 Let the ATO Know You’re Away
Before you leave Australia:
Update your myGov and ATO contact details
Set up or check access to your ATO-linked myGov account
Consider authorising someone you trust (like your family member or accountant) to handle ATO stuff on your behalf
This makes things a whole lot easier if something pops up while you’re overseas.
🧳 Before You Fly: Your Tax Checklist
Here’s a quick tax checklist to tick off before you jet off on your working holiday:
✅ Confirm your tax residency status
✅ Lodge any outstanding Australian tax returns
✅ Update myGov and ATO details
✅ Make sure your super is sorted
✅ Learn about tax obligations in your host country
✅ Get expert advice if you’re not sure where you stand
💬 Need Help Before You Go?
If you're heading overseas for a working holiday and want to make sure you're covered — tax-wise — we're here to help. We explain things in plain language and give you practical advice that fits your situation.
📩 Get in touch with Dawson Accounting if you would like to discuss your upcoming overseas trip