Not just travelling, but also using your time abroad to set up your own business, work independently and be your own boss – is that really possible as a backpacker in Australia? We explain how it works, what the advantages and disadvantages are, and what you definitely need to be aware of.

Can You Become Self-Employed on a Working Holiday Visa in Australia?

Yes, you can absolutely become self-employed as a backpacker in Australia. To meet Australian tax requirements, you must first apply for a Tax File Number (TFN). In addition, you will need an Australian Business Number (ABN). By applying for an ABN, you register yourself as a “business”, meaning you are recognised as self-employed. Your ABN is how you identify your business to the government and to potential clients.

Many backpackers choose to work independently during their stay in Australia. To work as a freelancer or contractor, you will therefore need both a TFN and an ABN.

Self-Employment and Taxes

If you work as an employee, your employer usually withholds tax on your behalf. If you are self-employed, however, you are responsible for paying your own taxes at the end of the financial year. It is important to set money aside regularly so you can meet your tax obligations when you lodge your annual tax return.

You must declare both your income as a working holiday maker (earned under your TFN) and your income as a freelancer or contractor (earned under your ABN) in the same tax return.

At the end of each financial year on 30 June, your ABN income is added to any other income you have earned. After lodging your tax return, your tax liability is calculated based on this combined income.

What Is the Tax Rate and Do You Need to Register for GST?

You also need to plan ahead when it comes to tax. As a non-resident for tax purposes, your income is taxed at a higher rate than that of Australian residents. The tax rate is 19% on the first AUD 37,000 of income. You should therefore be mindful of income thresholds, as any income above AUD 37,000 is taxed at 32.5%.

Your business must register for GST (Goods and Services Tax) if your annual turnover reaches AUD 75,000 or more. If your turnover is below this threshold, registration is optional. Once you exceed the threshold, you must register within 21 days. Taxi drivers and rideshare drivers must register for GST regardless of their turnover. The current GST rate is 10%.

Compliance and Record-Keeping

To ensure you meet your tax obligations at the end of the financial year, good organisation is essential. Helpful steps include:

  • Keeping all invoices issued as part of your business activities

  • Retaining receipts for products and services purchased for business purposes

  • Understanding your tax obligations under the Australian Taxation Office (ATO)

  • Maintaining transparency and accountability in all your activities

You may also choose to seek advice from a registered tax agent to ensure compliance. However, if you understand the requirements and stay organised, managing your obligations does not have to be overly complicated.

Is Self-Employed Work Accepted for a Second or Third Working Holiday Visa?

To qualify for an additional Work and Travel year, you must prove that you have completed specified work, meaning work in one of the approved industries and locations. This work can be completed either as an employee or as a self-employed contractor – both are permitted.

However, proving specified work is usually more complex for self-employed individuals. While employees receive payslips showing all relevant details, self-employed backpackers are responsible for documenting their work themselves. This includes detailed invoices, service descriptions, timesheets, customer details and work locations.

Some Australian employers prefer to engage Working Holiday Makers as contractors under an ABN rather than as employees. You should be cautious before accepting such arrangements, as they involve significantly more responsibility and compliance obligations. If you work exclusively for a single client, issues such as sham contracting may arise. If in doubt, you can seek guidance from the Fair Work Ombudsman.

It is also essential to comply with your visa conditions. On a Working Holiday visa, you may generally work no more than six months for the same employer. For self-employed backpackers, this means you may not work for the same client for longer than six months. Exceptions apply only in limited circumstances or by approval.

Should You Become Self-Employed in Australia?

Starting your own business always involves risk, particularly if you are considering leaving a secure job as an employee. You need to weigh these risks against the potential benefits. It would be unwise to put your career at risk without considering the downsides. Conducting a basic cost–benefit analysis before becoming self-employed is therefore strongly recommended. To help you make an informed decision, it is important to understand the main advantages and disadvantages of self-employment.

Advantages of Self-Employment as a Backpacker

Self-employment offers many benefits. You can choose when and where you work, have more control over your income and workload, decide who you work with, and potentially benefit from tax deductions.

Set your own working hours

The idea of running your own operation and working when you choose can be very appealing. If you feel like going surfing on a Friday afternoon, self-employment can offer that flexibility. You still need to meet deadlines set by clients, but if you manage that well, you can organise your time freely..

Work from anywhere

Many small businesses require nothing more than a phone, a computer and an internet connection. Self-employed individuals can often work from anywhere – from your bedroom in your pyjamas or even from the beach. This is the essence of the digital nomad lifestyle in Australia. Even if your business requires physical premises, you usually have greater freedom in choosing the location.

Potential tax benefits

As a self-employed individual, you may have more opportunities to claim tax deductions. Expenses directly related to earning your income may be deductible, such as advertising costs, business insurance or IT equipment. Keep in mind that you must incur these costs to claim them. Consulting a registered tax agent can help clarify which expenses are deductible and what records you need to keep.

Greater control over your income

Being self-employed means you are not negotiating pay rises with a boss. Your income is directly linked to your own effort, which can be motivating and potentially more lucrative if your business is successful.

Disadvantages of Self-Employment

While many people find the benefits outweigh the drawbacks, it is important to be aware of the potential downsides.

No work means no income

Time truly is money when you are self-employed. You may find it difficult to enjoy time off when you are constantly aware of lost income. Especially in the early stages, you may work longer hours than an employee while building a client base.

Irregular income

Self-employment often comes with fluctuating income. Busy periods may be followed by quieter phases, making it harder to manage regular expenses. Financial discipline and budgeting are therefore essential.

Managing your own bookkeeping

Accurate bookkeeping is mandatory for all small businesses and can be time-consuming and stressful if you are unfamiliar with it. Fortunately, there are many affordable accounting software options designed for small businesses.

No superannuation contributions

Employees receive compulsory superannuation contributions from their employer (currently 10.5%, rising to 12% by 2025). For self-employed individuals, superannuation is voluntary. For many backpackers who do not plan to stay in Australia long-term, contributing to superannuation may not be worthwhile.

Planning for tax payments

Employees have tax withheld automatically. As a self-employed individual, you must set aside funds yourself to pay your annual tax bill. As Moneysmart advises, it is important to separate personal funds from business funds. If your annual turnover exceeds AUD 75,000, you must also register for GST, collect 10% GST from clients and remit it to the ATO.

Success is not guaranteed

Self-employment is not always easy. It involves balancing freedom with uncertainty. While it can be incredibly rewarding to work in a field you love, not every business will succeed. Even so, many people would regret not having tried – especially since job security is never guaranteed, even in traditional employment.

Six-month work limitation

Remember that Working Holiday visa holders are generally subject to a six-month limitation per employer. This rule also applies if you are working as a contractor rather than as an employee.

Which Industries Can You Work in as a Self-Employed Backpacker?

To help you decide which type of work may suit you, here are some examples of self-employed roles currently available. Keep in mind that pricing should reflect your experience, local living costs and self-employment taxes.

Handyman / Trades Assistant

Average hourly rate: AUD 40–50

Tasks: General maintenance, repairs, renovations and construction-related work for private households or businesses.

Skills: Practical skills; simple tasks that do not require formal licensing.

Personal Trainer

Average hourly rate: AUD 40

Tasks: Designing training programs, guiding clients through exercises and monitoring progress.

Skills: Strong communication, motivation skills, background in sports science or kinesiology.

Uber Eats Driver

Average hourly rate: AUD 20–40

Tasks: Collecting food orders and delivering them safely and efficiently.

Skills: Clean driving record, valid driver’s licence; some platforms may require driving assessments.

Photographer

Average hourly rate: AUD 36.85

Tasks: Taking photos of people, places and objects; often specialising in areas such as weddings, journalism or wildlife.

Skills: Strong photography and photo-editing skills; own equipment usually required.

Content Creator

Average hourly rate: AUD 41.67

Tasks: Managing and growing social media accounts for organisations or individuals.

Skills: Expertise in social media marketing, organic and paid engagement, analytics and reporting.

 

Graphic Designer

Average hourly rate: AUD 42.68

Tasks: Creating graphics for websites, advertising and print materials; logo design and branding.

Skills: Design principles, colour theory and proficiency with design software.

Conclusion

Whether you are already self-employed or considering becoming so, self-employment can be a great option during your stay in Australia. The flexibility to work anywhere and anytime is ideal if you want to travel and explore the country. As a sole trader, you may be subject to different tax rates on your income, and it is always advisable to seek official guidance from the ATO. Nevertheless, self-employment offers an excellent opportunity to gain professional experience in a new country.