Australia taxes its residents on their worldwide income.  This would include salary, dividends etc that you earn from your limited company although there are special rules applying to certain expatriate individuals and tax exemption may be available for a limited time as far as the dividends are concerned (see the final paragraph of this article).  For other resident individuals, Australian tax is due on income derived from all foreign sources with the exception of salary and wages derived in performing duties outside of Australia for a continuous period of at least 91 days, provided these earnings are not exempt from tax in the foreign country in which they are earned.

Non-resident individuals are subject to Australian tax on income derived from sources in Australia.  They are subject to withholding tax on interest income and dividends paid by an entity resident in Australia as well as Australian-source royalties although specific tax rebates and exemptions may apply in the case of dividends paid out of Australian-taxed corporate income. 

In the case of salary and benefits from your limited company, the source is Australian since the duties of the employment are being performed in the Australia, regardless of where payments are made and whether the income is remitted to Australia.  However, dividends from your limited company (assuming this is not deemed to have a permanent establishment in the Australia – see below) would be from a non-Australian source regardless of where the dividends are received.  There is therefore scope for tax mitigation here in the event you do not become an Australian permanent tax resident (although non-Australian taxes may also need to be considered).

If you are in Australia for less than a relevant 183 day (approximately six months) period and are tax resident (and paying taxes on your salary/benefits) elsewhere then it may be possible and desirable for you to claim tax relief under a particular Double Tax Treaty.  The relevant 183 day period is either 183 days in a calendar year or in any period of 12 months, depending upon the particular treaty involved.  The Double Tax Treaty with the UK, for example, looks at 183 days in the Australian tax year which runs to 30 June. 

So, for example, you could work in Australia from 1 February through to the following 30 November and could claim to be exempt from Australian tax under a Double Tax Treaty which considers 183 days in the Australian tax year.  This is on the basis that, during the period concerned, you were tax resident in the other country and paying taxes on your salary and benefits there.  Unfortunately, the same approach will not work with regard to any dividends you receive although, as you will see below, these may be exempt from Australian tax in any event.

In some cases, it would be beneficial, from a tax standpoint, to claim exemption under a Double Tax Treaty, i.e., if your other country of tax residence levies lower taxes, e.g., as with the UK and Germany.  In other cases, whilst the tax liability in Australia may be broadly similar to or even lower than the taxes levied in your home country as with, perhaps, France, claiming exemption under a Double Tax Treaty offers administrative convenience and savings in professional fees (payroll bureau, tax return filing etc).  If you remain tax resident in another country and either choose not to claim under a Double Tax Treaty or are not eligible to do so, you will not be able to achieve tax savings even if your home country taxes are higher than in Australia.  This is because you will remain liable to tax in your home country and Australian taxes will simply be available to credit your home country liability.  If Australian taxes exceed your home country liability, no tax refund may be obtained. 

As an employee of a non-Australian limited company seconded to Australia, depending upon the country of tax residence of your company and, perhaps, your own nationality, it may be possible for you to remain within your home country social security scheme for a limited period.  This will be the case if Australia has a Totalisation Agreement covering social security contributions with the country of your employer or, in some cases, the country of your nationality.  You will need to seek specific advice from an Australian accountant or tax lawyer to establish whether there is a relevant agreement that can apply to you, especially since new agreements are being made on an ongoing basis. 

Any relevant Totalisation Agreement will cover the contributions of both employer and employee.  It will be necessary for you to apply for a ‘Certificate of Coverage’ from the organisation dealing with social security in your home country.  In making the application, you will probably require assistance from a tax adviser in the country of tax residence of your company, who happens to specialise in expatriate matters.  Obtaining the Certificate will enable you (as employer and employee) to continue to pay into your home social security scheme and thereby protect your entitlement, as an individual, to social security benefits, particularly pensions.  At the same time, you would normally apply for a certificate to cover you for publicly-available health care in Australia.

If your home country contributions are higher than in Australia, e.g., as in France, it could be that you would prefer to pay social security in Australia instead.  In this case, you would not make an application for a certificate to keep you in your home country scheme but would withhold Australian Medicare and Superannuation contributions together with the tax withholding.