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Document Tax withholding for non-Australian residents

Under paragraph 2.6.2 of the Instruments, the Commission may approve payment of an education allowance to a student who is living overseas and not on a formal exchange or scholarship program for less than 12 months if it deems there are ‘exceptional circumstances’.

Students approved as having ‘exceptional circumstances’ who are living overseas and are 16 years of age or older will not be considered an Australian resident by the Australian Taxation Office for taxation purposes. Accordingly, these students will be deemed to be ‘foreign residents and so’ will not be entitled to the tax-free threshold. Higher withholding tax rates may also apply to foreign residents receiving an Australian income. Please see the Australian Taxation Office website for more information.