This withholding schedule is made by the Commissioner of Taxation in accordance with sections 15-25 and 15-30 of Schedule 1 to the Taxation Administration Act 1953 (TAA). It applies to withholding payments covered by section 12-35 of Schedule 1 to the TAA.
Using this schedule
This schedule is for payments made from 13 October 2020.
You should use this schedule if you make payments to individuals in the horticultural industry who:
- work in any process associated with the production, cultivation or harvest of a horticultural crop
- perform the process on the grower’s property
- do not work for the same grower for a continuous period exceeding six months
- have given you a valid Tax file number declaration and have claimed the tax-free threshold.
Also, use this schedule if you make payments to individuals in the shearing industry such as shearers, crutchers, wool classers, cooks, shed hands and pressers who:
- have given you a valid Tax file number declaration (NAT 3092) and have claimed the tax-free threshold
- do not work for the same employer for a continuous period exceeding six months.
For all other circumstances, use the relevant PAYG withholding weekly or fortnightly tax table.
You can also:
- use the Withholding lookup tool (XLSX 34KB)This link will download a file to quickly work out the amount to withhold.
- download a printable version of Tax table for individuals employed in the horticultural or shearing industry (PDF 840KB)This link will download a file (NAT 1013).
If you employ individuals under the Seasonal labour mobility program, this schedule does not apply. For these individuals you are required to withhold at 15%. For more information about the program, refer to Seasonal Worker Programme and Pacific Labour Scheme.
If you employ individuals under a working holiday makers visa, you must use the Tax table for working holiday makers.
Working out the withholding amount
To work out the amount you need to withhold you must
- Input your employees total earnings into the Withholding lookup tool (XLSX 34KB)This link will download a file.
- Use the appropriate column to find the correct amount to withhold
- Column 2 if the resident employee has given you a TFN
- Column 3 if the resident employee has not given you a TFN
- Column 4 if the foreign resident employee has given you a TFN
- Column 5 if the foreign resident employee has not given you a TFN.
Example
An employee has earnings of $231.50.
To work out the correct amount to withhold, ignore cents, input $231 into the Withholding lookup tool (XLSX 34KB)This link will download a file.
If the employee is:
- a resident employee and has given you a TFN, use column 2 to find the correct amount to withhold ($30)
- a resident employee and has not given you a TFN, use column 3 to find the correct amount to withhold ($108)
- a foreign employee and has given you a TFN, use column 4 to find the correct amount to withhold ($75)
- a foreign employee and has not given you a TFN, use column 5 to find the correct amount to withhold ($103).
Resident employees
The standard rate of withholding of 13% applies if an employee has given you a valid TFN and you withhold amounts using the figures shown in column 2 of the Withholding lookup tool (XLSX 34KB)This link will download a file.
If the employee has not given you a valid TFN, you must withhold amounts using the figures shown in column 3 of the Withholding lookup tool (XLSX 34KB)This link will download a file.
When your employee is a foreign resident
If your employee has answered no to the question ‘Are you an Australian resident for tax purposes?’ on their Tax file number declaration, you will need to use the foreign resident tax rates.
There are two ways you can withhold from a foreign resident’s earnings:
- If they have given you a valid TFN, you must withhold amounts using the figures shown in column 4 of the Withholding lookup tool (XLSX 34KB)This link will download a file.
- If they have not given you a valid TFN, you must withhold at 45% using the figures in column 5 of the Withholding lookup tool (XLSX 34KB)This link will download a file.
Foreign residents cannot claim tax offsets to reduce withholding. If your foreign resident employee has claimed a tax offset on the Withholding declaration, don’t make any adjustments to the amount you withhold.
Pay period
The rates in this schedule apply irrespective of the pay period.
Using a formula
The withholding amounts shown in this schedule can be expressed in mathematical form.
If you have developed your own payroll software package, you can use the formulas and coefficients outlined below.
The formulas comprise linear equations of the form y = ax, where:
- y is the amount to be withheld expressed in dollars
- x is earnings for the pay period, ignoring any cents
- a is the value of the coefficient as shown in Table A.
Has the employee provided their TFN? |
Resident (a) |
Foreign resident (a) |
|---|---|---|
Tax file number provided |
0.13 |
0.325 |
Tax file number not provided |
0.47 |
0.45 |
Rounding of withholding amounts
The withholding amounts calculated as a result of applying the above formulas should be rounded to the nearest dollar. Results ending in 50 cents are rounded to the next higher dollar. Do this rounding directly – that is, do not make a preliminary rounding to the nearest cent.
Software
Payroll or accounting software written in accordance with the formulas in this schedule should be tested for accuracy against the Withholding lookup tool (XLSX 34KB)This link will download a file. The results obtained when using the coefficients in this schedule may differ slightly from the Withholding lookup tool. The differences result from the rounding of components. Withholding calculated using either method is accepted.
Tax file number declarations
The answers your employees provide on their Tax file number declaration determine the amount you need to withhold from their payments. A Tax file number declaration applies to any payments made after you receive the declaration. If you receive an updated declaration from an employee, it will override the previous one.
If an employee does not give you a valid Tax file number declaration within 14 days of starting an employer-employee relationship, you must complete a Tax file number declaration with all available details of the employee and send it to us.
When a TFN has not been provided
You must withhold 47% from any payment you make to a resident employee and 45% from a foreign resident employee (ignoring any cents), if all of the following apply:
- they have not quoted their TFN
- they have not claimed an exemption from quoting their TFN
- they have not advised you that they have applied for a TFN or have made an enquiry with us.
If an employee states at question 1 of the Tax file number declaration that they have lodged a Tax file number – application or enquiry for individuals with us, they have 28 days to provide you with their TFN.
If the employee has not given you their TFN within 28 days, you must withhold 47% from any payment you make to a resident employee and 45% from a foreign resident employee (ignoring any cents) unless we tell you not to.
Do not allow for any tax offsets or Medicare levy adjustment. Do not withhold any amount for study and training support loans.
Varying your PAYG withholding
If your employee believes that, for their circumstances, the amount you withhold will be too much, they may apply to us for a variation to reduce the amount of withholding.
For more information, refer to Varying your PAYG withholding.
PAYG withholding publications
You can access all PAYG withholding tax tables and other PAYG withholding publications at:
Work out the tax to withhold from payments made to employees in the horticultural or shearing industry.