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ATO Changes Mean Employers May Face Significant Fines

Any business who employees foreign citizens and has not been performing ongoing visa checks can now be automatically caught as a result of new data matching between the ATO and the Department of Home Affairs.

What Has Changed?

In respect to Visa holders, the biggest change for employers is the recording of tax file numbers against Visas, combined with release of the ATO’s ‘Single Touch Payroll’. Since December of 2017, the Department of Home Affairs (DHA) has collected tax file numbers from all new visa applicants, enabling simplified data matching between the two departments.

As a result, when an employer submits their payroll / PAYG data to the ATO, the DHA can data match against that and can determine that: a) the employer has not been checking employees’ visas (because the DHA retains a log of every check against a Visa holder), and b) that Visa conditions have been breached.

A Common Scenario

For example, if the payroll data for a given visa holding employee indicates a salary commensurate with working 60 hours over the fortnight, but the visa holder is restricted to work 40 hours over that period, as is often the case for student visa holders, a breach could be automatically detected.

In the past, detecting a compliance breach typically involved the Department of Home Affairs conducting an audit, which is both time consuming and inefficient. However, with the introduction of ‘One Touch Payroll’, audits can be performed automatically simply through inter-departmental data sharing.

What Can Happen?

Australian businesses can face fines of up to $315,000 for breaching visa conditions. Company directors can be held personally responsible for non-compliance, even if they are unaware of the specific employee, and can individually face fines of up to $63,000 per illegal worker.

Further, in the scenario listed above where visa conditions were breached, not only would the employer face potentially significant fines, the visa holder would likely have their visa cancelled resulting in deportation for the individual concerned.

It’s Only a Problem if You’re Not Compliant

While the ATO has suggested that businesses should not ‘panic’ about single touch pay roll, many Australian businesses aren’t aware of their full obligations, or are simply not compliant when it comes to ensuring the on-going work rights of their visa-holding employees.

Employer Obligations

Where employees are foreign citizens, employers are required to check that employees have the legal right to work in Australia both during on-boarding, and throughout the duration of employment.


The Checkworkrights application simplifies initial checks and automates ongoing visa checking for employers of all sizes. Explore our smartphone passport scanning app for free today.

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Disclaimer: The information provided in this article is general only, and not to be taken as Migration Advice. Please be aware that visas and regulations are subject to frequent change. It is advisable to verify the latest information from the Department of Home Affairs (DHA) and or seek specific advice relating to your circumstances from a MARA Registered Migration Agent.