Cross-Border Remote Work FAQs Australia

The following FAQs are designed to address the scenario where a foreign national employee of a foreign company wishes to work remotely for a period of time in your countryAustralia performing services exclusively for the foreign company and not interacting with the local market in your countryAustralia.

These FAQs have been prepared in collaboration with immigration specialist, Mr Ivan Chait of IMC Migration Australia Pty Ltd, and taxation specialist, Mr Nathan Boss of Munro Lawyers.

Work authorisation

A. Is work authorisation required? If so, please provide a brief description of the type of visa, procedure, processing time, etc.

This depends on the period of time that the foreign national will be in Australia. A normal visitor visa will suffice if it is for less than 3 months and they will not receive any remuneration in Australia, will work exclusively for the foreign employer, and will not deal with any Australian business while in Australia.

If the employee will be in Australia for between 3 and 6 months undertaking specialised work in Australia for an Australian business on behalf of the foreign employer, then the employee should first apply for a Temporary Work (Short Stay Specialist) visa, subclass 400. This will allow the employee to work in Australia and receive remuneration in Australia during the visa validity period. The Department of Home Affairs (“DOHA”) is currently quoting an average processing time of 28 days for 90% of applications.

Where a foreign company requires a foreign national employee to work in Australia for a period of between 3 months and 4 years, the foreign employer should sponsor the employee to work in Australia under the Skills in Demand visa category, subclass 482 as an overseas business sponsor. It should be noted that overseas business sponsorship is used when an overseas business intends to:

• establish, or help establish, a business operation in Australia in association with a business located outside of Australia; or
• fulfil, or help fulfil a contractual obligation in Australia.

It is important to note that a foreign employee in Australia on a subclass 482 visa with an overseas business sponsorship is not eligible to apply for permanent residence under the Employer Nomination Scheme, subclass 186 (Transition Stream). This option is only available to foreign employees in Australia under a Standard Business Sponsorship, subclass 482 once they have been employed in Australia in their nominated occupation for at least 2 years.

Foreign companies considering the subclass 482 visa program should note that the minimum salary thresholds applicable from 1 July 2026 are:

• Applicants applying under the Core Skills Stream: $79,499.00 (excluding superannuation); and
• Applicants applying under the Specialist Skills Stream: $146,717.00 (excluding superannuation).

DOHA is currently quoting an average processing time of 3 months to 8 months for 90% of applications.

In summary, there are three parts to a Skills in Demand visa application, subclass 482, being:

• Standard or Overseas Business Sponsorship;
• Business Nomination, which includes labour market testing (unless exempt), confirmation that the occupation is included on the current Core Skills Occupation list, and that the foreign employee will be paid a market related salary in Australia; and
• Skills in Demand visa application.

It is advisable that foreign companies seek immigration advice before permitting employees to work remotely overseas.

B. Is there risk of "permanent establishment" consequences for the foreign company by virtue of the remote worker’s activities?  If so, what are the main factors determining the exposure.

Australian domestic law provides Australia with taxing rights in respect of both residence and source. Broadly, foreign companies are subject to tax on any income derived directly or indirectly from Australian sources.

The source of income assessment in Australia is a complex area. In respect of business income, the place where the contract is negotiated, the place where the contract is performed and the residence of the payee are relevant factors in determining whether income has an Australian source.

Where an employee performs work for a foreign company in Australia, it might be determined that the profits derived in respect of that work have an Australian source, being the place where the relevant services are performed.

The term “permanent establishment” (“PE”) has limited relevance under Australian domestic law. The primary relevance for foreign companies relates to their capital gains tax liability in respect of any assets owned or used under or through a PE in Australia. In the absence of a PE, the sale of a capital asset by a foreign company would be exempt from tax in Australia unless it is considered “Taxable Australian Property”.

The existence of a PE is relevant however in determining whether any relief is available under any double taxation agreements entered into between Australia and the country in which the foreign company is based. If there is no double taxation agreement in place, then the taxation in Australia of business profits of the foreign company is determined solely on a source basis.

Some double taxation agreements restrict the ability of Australia to tax the business profits of a foreign company unless that foreign company has a PE in Australia. A foreign company will generally be considered to have a PE in Australia where it operates through a fixed place of business in Australia. The presence of a remote employee working in Australia might be sufficient to establish that the foreign company operates through a fixed place of business in Australia, potentially being the home of the employee. This will be dependent on a number of factors including the permanence of the location of work of the employee and the length of their stay within Australia.

In short, taxation advice should be sought prior to entering into any agreement to provide a worker with the opportunity to work remotely from Australia in light of the above issues. The advice should consider first whether the arrangement will result in the income of the foreign company having an Australia source, and, if so, whether any double taxation agreement can provide relief, particularly on the basis that the foreign company does not carry on its business through a PE in Australia.

While there were some exemptions provided for foreign companies during the COVID-19 pandemic where employees were stuck in Australia due to travel restrictions, these concessions ceased on 1 January 2022.

Local social security and other payroll requirements

C. At what point and under what circumstances would the remote worker become subject to local social security and other payroll requirements?  Can such requirements be fulfilled by a foreign company, and if so by what mechanisms?

Australian residents for tax purposes are liable to pay the Medicare levy, generally being 2% of taxable income (used to fund some of the costs of Australia’s publicly funded system of universal healthcare). Foreign tax residents will need to apply for an exemption from paying the Medicare levy. Generally speaking, when employers withhold Pay As You Go (“PAYG”) income tax from employees, the Medicare levy is included as part of the calculation.

Australia also has a system of compulsory superannuation contributions.

Mandatory superannuation payments must be made under Australian law on payments of salary and wages from an employer to an employee. The mandatory payment is currently 12% of the total salary and wages paid to an employee.

These requirements apply generally to foreign companies to the extent that the employee provides services to the employer within Australia.

Local employment law requirements

D. At what point and under what circumstances does the remote worker working inside Australia become subject to local employment law requirements such as is wage-hour, local holidays, annual leave, maternity leave, disability leave, protection against unfair dismissal, etc? Conversely, is it possible for workers working remotely outside of Australia to make use of Australian workplace law protections?

Remote workers working inside Australia

Generally, all people working in Australia (including foreign national workers that work remotely for a period of time in Australia) are entitled to basic rights and protections in the workplace. To avoid doubt, this includes foreign workers who are not Australian citizens or permanent residents, such as “backpackers”, seasonal workers, or international students.

Protections under the Fair Work Act 2009 (Cth) (“FW Act”) will apply to employees of a foreign corporation engaged to perform work within Australia, where the foreign corporation is considered a “national system employer”. However, this does not mean every foreign corporation will “fall within” the FW Act. As was stressed in Fair Work Ombudsman v Valuair Ltd (No 2) (2014) 224 FCR 415 and Holmes v Balance Water Inc & Ors (No 2) [2015] FCCA 1093, before a company will be considered a “national system employer”, and therefore within the FW Act, there must be:

a) an “appropriate connection” aligning the employment relationship with Australia; and

b) the employment relationship must be “sufficiently” linked with Australia.

Relevant factors include:

• Proportion of overall working time spent in Australia;
• Domicile of employing entity;
• Currency income is paid in;
• Employment address;
• Jurisdiction where taxation is paid;
• Existence of directions from the employer as to the location of work;
• Contractual stipulations as to the location and choice of law in the employment contract;
• Location where the worker is employed and where the contract is formed;
• Whether the decision to work remotely is that of the employee; and
• Whether the employee becomes a resident for tax purposes.

Remote workers working outside Australia

Conversely, it is important that Australian employers with employees based overseas seek advice as to whether such remote workers are entitled to make use of Australian workplace laws, such as the FW jurisdiction, to seek compensation for such things as unfair dismissal.

Pascua v Doessel Group Pty Ltd [2025] FWC 1833 is the latest in a sequence of decisions concerning a paralegal named Ms Joanna Pascua working remotely in the Philippines for a law firm based in Queensland (“Pascua case”), highlighting core insights for employers in the face of cross-border outsourcing arrangements.

The Pascua case confirms that employees based overseas can apply to the Fair Work Commission (“FWC”) for unfair dismissal, so long as they have a direct contractual relationship with an Australian employer that purports to dictate and control the manner of performance of their work.

While the Full Bench noted in its decision that, in a simple sense, Ms Pascua fit within the concept of being a “national system employee” to the extent she was employed by Doessel Group, it acknowledged that “[t]here are, however, territorial limits to the operation of the Act”. In particular, there was the outstanding question of whether Ms Pascua was an employee “engaged outside Australia and the external Territories to perform duties outside Australia and the external Territories”.

While the Full Bench found that Ms Pascua’s work appeared to have been entirely performed outside Australia, it did not address the question of whether the contract of employment was formed in Australia because direct evidence on formation was not given at first instance.

Although the question of the general application of Part 3-2 of the FW Act to employees of Australian employers performing work overseas was considered important, the Full Bench did not grant permission to appeal in relation to it because the issue was not directly argued, and the evidence was incomplete.

In any given case, employers should therefore seek advice regarding the proper law governing contracts for workers based overseas to confirm whether any liability in Australia exists. Determining the territorial limitations of Australian workplace laws is crucial to understand an employer’s liability where work is performed overseas.

Remote foreign worker

E. Are there special requirements governing remote work in your country which would cover the remote foreign worker?

There are no special requirements governing remote workers per se. The above principles apply.

Income tax

F. What is the employee’s exposure to local income tax, and under what circumstances is the foreign employer required to arrange for withholding of income tax?

An employee’s exposure to tax in Australia is dependent upon whether the exemption for an employee(s) who cannot return to their usual place is considered a resident of work overseas due to COVID travel restrictions, if an individual is Australia. The employee will automatically be a resident of Australia where they are present in Australia for more than 183 days (continuously or intermittently), they will be a resident for taxation purposes within an income year. They will also be a resident where they are considered to reside in Australia within the general meaning of that word or have their domicile in Australia (unless it can be established that their usualthey have a permanent place of abode is outside Australiain Australia). The rules around residency have been subject to significant interpretation, both by the courts and that they have no intention to take up residence here. If they arethe Australian Taxation Office.

Where an employee is a resident, of Australia they will are subject to taxation on their worldwide income. If an employee is not a resident of AustraliaAustralia, they will only be liablesubject to pay Australian income tax,tax on income that has an Australian source. This is subject to any relief provided to the employee under any double taxation agreements in place between Australia and theirthe original country of residence of the employee.

Australian domestic law provides that an employer must withhold an amount from salary and wages it pays to an individual as an employee. Even though the provision is not restricted to Australian employers, it still does not expressly provide that it has extra-territorial operation.

Commentary from the Australian Taxation Office indicates that, in its view, foreign employers will be liablerequired to withhold for work performed by the employee in Australia (and potentially overseas where the employer has a sufficient connection with Australia).

Taxation advice should be sought prior to implementing a remote working arrangement in Australia with a view to establishing the company’s withholding requirements.

If withholding is required, the foreign company will be required to withhold that tax on their behalf (and remit it to the Australian Taxation Office).

Claim for workplace injury

G. Would the remote worker be entitled to bring a claim for workplace injury in your country?

At the outset, it is important to distinguish between Australia’s work, health and safety (“WHS”) jurisdiction, workers compensation jurisdiction and common law duty of care.

Australian WHS law was harmonised in 2010 with the development of a Model Act. The statutes in Australian jurisdictions that have adopted the Model Act are generally referred to as the “WHS Acts”; this includes the Australian Capital Territory, New South Wales, Northern Territory, Queensland, South Australia, Tasmania, and Western Australia. Victoria is the only state that has not enacted the Model Act: see Occupational Health and Safety Act 2004 (Vic) (“OHSA 2004”).

The WHS Acts include a primary duty expressly imposed on the person conducting the business or undertaking (“PCBU”), whether as employer, contractor, occupier, or in some other capacity. This primary duty is considered the cornerstone on which the entire structure of the WHS Acts depends. It provides that the PCBU must ensure, so far as is reasonably practicable, the health and safety of workers. “Workers” are broadly defined as any persons who carry out work “in any capacity” for a PCBU, including not just employees, but also contractors, employees of contractors, labour hire employees, outworkers, apprentices (or trainees), work experience students, volunteers, and others. Crucially, there does not need to be a direct contractual relationship between the PCBU and the worker.

Notably, this primary duty is complemented by a number of further duties which work to ensure that particular kinds of PCBUs owe more specific obligations to all persons who may be reasonably expected to be affected by the conduct of their business.

Unlike the common law duty of care, the general duties in both the WHS Acts and the OHSA 2004 are preventative and inchoate, meaning a PCBU may be found to have contravened such a provision without a worker actually suffering injury, disease, or death.

Where a duty is owed to workers travelling or based abroad for work, employers will owe the same primary duty to those workers as to their Australian based workers. However, what is “reasonably practicable” in terms of providing a safe working environment will be impacted by the ability of the employer to control or influence safety outcomes in the relevant circumstances.

It should also be noted that workers may have other rights in relation to workplace injuries. In all jurisdictions, there are compulsory insurance schemes (that is, “workers compensation insurance”) which may allow even remote workers to bring claims. While the statutory obligation to have insurance is common to all schemes, each jurisdiction will have specific requirements and advice will be needed on an individual case by case basis.

Similarly, the common law right to take action for harm caused by the employer’s negligence still exists in all Australian jurisdictions, though each has various statutory modifications and restrictions on the right to take action for workplace injury, and again, individual advice will be needed.

Finally, the FW Act also has some provisions relating to compensation where an employer has breached that legislation, and remote workers who fall under the FW jurisdiction may also be able to claim compensation under the FW Act for loss associated with the breach.

National healthcare system or insurance

H. Would the remote worker be covered under the local national healthcare system or insurance?

The coverage under Australia’s Medicare system will be dependent on the visa on which the relevant holder entered into Australia. Generally, most holders of permanent visas, individuals applying for permanent visas, and holders of some temporary work visas will be able to access Medicare.

Potential migrants to Australia should seek advice as to the availability of Medicare coverage prior to arriving in Australia.

It is unlikely that state payroll tax would apply to the situation where a foreign company has one employee working remotely in Australia, given this tax only applies where the total Australian wages they pay exceeds the relevant thresholds imposed in each state. In New South Wales for instance, that threshold ofis $1,200,000 in a financial year. The threshold is lower in Victoria at $700,000.

Data privacy and security

I. Is a foreign employer subject to data privacy and security requirements regarding protection of employee personal information for a foreign employee working remotely in your country?

The Privacy Act 1988 (Cth) (‘the Act’) provides the Australian Privacy Principles (‘APPs’) and governs the collection of personal information by certain entities in Australia. The APPs apply to APP entities, which includes private sector organisations with an annual turnover of more than A$3 million and their related companies, as well as some others including health service providers and organisations that trade in personal information.

The Act extends to the activities of foreign companies in Australia, and to the activities of foreign companies outside Australia, where those companies carry on business in Australia, and collect or hold personal information in Australia. The Office of the Australian Information Commissioner (“OAIC”) considers the collection of personal information from an individual located in Australia to be a collection ‘in Australia’, even if the company collecting the information is outside Australia at the time.

Importantly, APP 11 provides that if an APP entity holds personal information, the entity must take such steps as are reasonable in the circumstances to protect the information from:
(a) misuse, interference and loss; and
(b) from unauthorised access, modification or disclosure.

Foreign remote worker

J. Has there been any litigation or specific law or regulation regarding the foreign remote worker in your country?

As previously mentioned, there have been numerous cases and publications by the Australian Taxation Office governing the residency of an individual. There has also been a proposal to simplify the residency based on an individual’s physical presence in Australia. This was proposed in the 2021-2022 budget, but nothing has come of this proposal in the intervening period.

In general, the Australian approach, both from a federal and state taxation perspective, has become harsher in respect of the treatment of the capital assets owned by foreign residents and/or foreign persons in Australia.

Citizenship

K. Would any of the above answers change if the remote worker (a) is a citizen of your country, or (b) engages in activity interacting with the local market?

a) Australian Citizens, Australian Permanent Residents or New Zealand Citizens lawfully resident in Australia do not require DOHA authorisation to work in Australia. Any other foreign national does require permission to work in Australia.

b) Engaging in activity interacting with the local market may have implications regarding the creation of a permanent establishment in Australia for taxation purposes. Employers should seek specialist taxation advice.