What is TFN (Tax File Number)?
The Tax File Number is a 9-digit personal tax identifier issued by the ATO. Every Australian taxpayer needs one to lodge tax returns, receive Medicare, and avoid having tax withheld at the top marginal rate (47%). Companies have a separate company TFN.
Example
A new employee provides their TFN to the employer on a TFN Declaration form, allowing PAYG withholding at the correct marginal rate rather than the no-TFN rate of 47%.
How TFN (Tax File Number) works in Australia
The Tax File Number is Australia's most important personal tax identifier. It is issued by the ATO and remains yours for life — it does not change if you move, change jobs, or change names. Unlike an ABN (which is a public business identifier), a TFN is private and must be treated as confidential.
**Who gets a TFN**
- Individuals (Australian residents and migrants) - Companies (a company TFN is separate from a director's personal TFN) - Trusts, partnerships, and superannuation funds all have their own TFNs - Non-residents working in Australia or receiving Australian income
**How to apply**
Australian residents apply via the ATO website (ato.gov.au), at an Australia Post outlet, or at an ATO shopfront. You will need identity documents. Processing takes up to 28 days. New migrants can apply through the Department of Home Affairs when applying for their visa. New born Australians are often assigned a TFN at birth linked to the Medicare card.
**The 47% no-TFN withholding**
Just as the no-ABN rule requires 47% withholding on business payments, there is a parallel no-TFN rule for individuals:
- If a new employee does not provide their TFN to their employer, the employer must withhold at 47% (the top marginal rate plus Medicare Levy) - If a bank customer does not provide their TFN, the bank withholds 47% on interest payments - If an investor does not provide their TFN to a fund, 47% is withheld on distributions
You can reclaim the withheld amount by including it in your tax return, but this delays the cash.
**TFN Declaration form**
When starting a new job, employees complete a Tax File Number Declaration (NAT 3092) and give it to their employer. This tells the employer the correct marginal rate to withhold at (based on income bracket and residency status, plus Medicare Levy variation). Since STP Phase 2, this can also be lodged digitally through ATO Online via myGov. Never give your TFN verbally — always use the official ATO form.
**Privacy protections**
Australian law strictly limits who can collect, use, and disclose TFNs. Employers, banks, and super funds can hold your TFN but cannot pass it to anyone else without your consent. Misuse of a TFN — including requesting it without a legal reason — is an offence under the Privacy (Tax File Number) Rule 2015. A TFN is never displayed on public registers; it is not searchable.
**Company TFN vs personal TFN**
When you set up a Pty Ltd, the company is issued its own TFN (separate from the director's personal TFN). The company uses its TFN to lodge the company tax return (Form C), register for PAYG withholding, and communicate with the ATO on tax matters. A director's personal TFN is never used for company tax purposes.
Related terms
The Australian Business Number is an 11-digit identifier issued to businesses by the Australian Business Register. Without an ABN, payers must withhold 47% from your invoice. Required for GST registration, business name registration, and most B2B trading.
Pay As You Go Withholding is the system Australian employers use to deduct tax from employee wages and remit to the ATO. Real-time reporting via Single Touch Payroll (STP) Phase 2 is mandatory at every pay event. Cash flow remittance is via BAS (quarterly or monthly).
Company Tax is the federal tax Australian companies pay on taxable income. The base rate is 25% for 'base rate entities' (turnover under A$50 million and ≤80% passive income). All other companies pay 30%. There is no separate state-level company tax.
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