Dealing With Money in Australia

Getting Paid

In Australia, the minimum wage is $17.70 per hour or $672.70 per week (as of 2016).

This may seem high, but keep in mind you will not see a big chunk of it that go out to taxes (and super, if that is included in your wage), plus cost of living in Australia (especially in the cities) is quite high.

NOTE: You’ll need to open a bank account to get paid.

You will find jobs that pay as low as minimum wage or $15 an hour, but unless it’s something you really want to do, I say hold out for something better. An average job will probably pay somewhere in the $18-20/hour range. (NOTE: This information, and much of the rest of the information in this post, is as of 2012, when I worked in Australia.)

Sales and Marketing Jobs

For example, a lot of backpackers (myself included, for a very short time) work in call centers or street marketing/sales. In the call center, I made a little over $19/hour, so not bad. And if you’re really looking to save up money for a few months of travel, you can work six days a week if you want.

However, some of the street marketing/sales jobs can end up sucking because you might only get paid on commission (with a VERY low hourly wage, if any at all). You can get end up working a LOT for close to nothing (I know from experience).

Don’t be afraid to ask about pay when you’re interviewing for a job.

I did an “interview” for an on-the-street-raising-money-for-charity type job. We actually went out on the street for the first part of the interview and I straight up asked one of the girls who was working how much she got paid. The answer was nothing but a small commission for the couple sales she made a day (if she was lucky). She enjoyed doing it, so good for her, but she also worked all day (paying for her own transportation around the city to different sites every day) and then had another job to actually pay the bills. I knew that was not for me.

Office Jobs

If you can find a decent office job you could find yourself getting paid $25-35/hour. If you have a lot of skills and experience, the possibilities are endless. Also, not all jobs list wages by the hour. They may quote you the annual pay even if they are hiring you on a contract or short-term basis. Ask them to break it down for you anyway (and/or know what the hourly wage you want translates to as an annual wage), because you could find yourself agog at a big number only to find it ends up being about $15/hour (again, happened to me!)

Sometimes you’ll have to go through the whole process and get the job (or at least the interview) before you can find out the pay. Don’t be afraid to say no if you don’t think it’s high enough. They may even up the ante a bit if you show a bit of displeasure. And if it’s not a contract and you’ve been hunting desperately for a while, there’s no shame in survival, take the job while you look for something better. It’s all part of the Work & Holiday experience!

Read: Job Hunting in Australia

Taxes

So how much of that paycheck gets whisked away as taxes? A lot more than I’d like! If you’re coming from the States (and like me have only worked part time and summer jobs so haven’t really been raking in the dough), it’s going to sound like a lot. If you’re like my boyfriend and come from a country that takes out half your earnings in taxes, it doesn’t seem so bad. The flat tax rate for Work & Holiday workers is 29%. (NOTE: This may have changed to 15-19% in 2017.)

My beef with this is that you aren’t really getting any benefits. OK, in Sweden you get free health care and education, so paying the government half your money isn’t so terrible. But in Oz, those of us without a special agreement (again, here the Swedes and various other Europeans luck out) don’t get free health care or any of that good stuff. But alas, it’s not worth complaining about. I just hate looking at my money earned and then my money actually earned and mourning the loss of nearly $300/week. That’s a lot of money! That’s rent!

Tax Returns

You can apply for a tax return (in fact you are required to file a tax return), but the horror is you might actually find you owe more money, rather than the other way around! The financial year ends on 30 June so you can file your tax return anytime between then and the end of October.

Here’s the thing on tax returns. If you can file as a resident, then you’re golden and you may very well get some money back (especially if you’ve been getting taxed as a non-resident). But the only way you can claim residency for tax purposes is if you’ve lived and worked in the same place in Australia for six months during the financial year. Well, that’s all well and nice if you don’t come to Australia less than six months before the end of the financial year.

If you come in, say, March, like I did, then even if you find a job right away you will have only lived and worked four or five months come end of financial year. And given that you can only work six months at any job anyways, this means you need idea circumstances to allow you to file as a resident. But if you can, do it!

Otherwise, claim away for anything you can. The first time I went through my tax return I just clicked through “no” on everything and expected to see a pretty little amount of money owed back to me. Wrong. I was told I owed over $200. Say what? I was already being taxed at 29% so I have no idea what the deal was, but it taught me not to avoid declaring deductions.

You can claim deductions for everything from public transportation for work to any clothing, gear, educational materials, etc. that you may have needed to purchase for work. Anything you claim under $300 you will not have to show receipts for, so it’s worth it to make some claims.

Don’t be fooled by all the ads you see for Tax Back companies targeted at backpackers. For one, even if you’re just filling out a form for a free quote on their website, they will call you night and day hounding you to file with them. Personally, I can’t see how this service can be worth it. It’s likely you will get very little tax back and most if not all of it will just go back into their pockets.

I’m not sure how they all work, but it seems to me you could end up owing them! All they do is give a false impression that Work & Holidaymakers will get all or most of our tax back, which is completely untrue. I believed it until I finally sat myself down to do my tax return and did some real research. It was sad to learn the truth, as I really thought I’d be getting back a good chunk of cash instead of paying hundreds of dollars to the Australian government every week and yet still owing more.

But don’t even take my word for it, do your research.

Superannuation

Your employer pays 9% of your earnings into super, which is basically Australia’s retirement fund. Be sure to find out if super is included in your wage or not. If a wage is listed as $20/hour + super, that’s good! (If super is included it’s not necessarily bad, it just means that 9% of your wage is going to be taken out before you ever get a hold of it.)

After you leave Australia you can file to get your super back. You probably won’t get it all back, but you should get back a good piece of it.

One last tip

When you open your bank account, open a savings account (if it’s free). Put most of your money in there and you should make at least a little money from interest. Probably not a lot, but probably more than you expected… and every dollar counts whether you’re saving for travel, a night on the town, or your flight home!

Read more about working abroad in Australia