A tax file number is issued to an individual, not to an employer, and stays with them for life. New employees complete a tax file number declaration for each employer, which tells the employer how to withhold.
The employer's side of it
An employer must collect the declaration and act on it. Where an employee does not provide a tax file number, withholding must be applied at the top marginal rate, which produces a take-home figure the employee will immediately query. There are also privacy obligations: a tax file number is protected information and must not be used as a general employee identifier or shared beyond its permitted purposes.
- Collected at onboarding, alongside super fund nomination and bank details
- New arrivals to Australia may need to apply for one after arriving
- A short grace period applies before top-rate withholding kicks in
Why it matters when hiring internationally
This is an onboarding dependency rather than an ongoing one, but it is a hard one: an Australian hire cannot be paid correctly without it. For employees relocating to Australia, the application timing needs to be factored into the start date, and it is worth confirming who guides the employee through it.