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TFN declaration

A TFN declaration is the ATO form a new employee completes so you withhold the right PAYG tax. No TFN within 28 days means withholding at 47%. What builders need.

By Chalkline. Last updated 25 May 2026. Verified 25 May 2026.

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A TFN declaration (Tax File Number declaration) is the ATO form a new employee or apprentice completes so the employer knows how much PAYG tax to withhold from their pay. It is a day-one payroll document: without it, you cannot work out the correct withholding and must default to the top rate.

What it sets

The declaration captures the inputs to the PAYG withholding calculation:

  • the employee’s tax file number,
  • whether they claim the tax-free threshold (you can only claim it with one employer),
  • any HECS/HELP (study and training) loan to be repaid through withholding,
  • their residency status for tax.

It is for employees, not contractors. A subcontractor quotes an ABN and invoices you; they do not complete a TFN declaration.

The no-TFN consequence

If a new payee has applied for a TFN, they have 28 days to provide it, and you withhold at the standard rate meanwhile. If they have not provided it within 28 days, you must withhold at the top rate: 47% for a resident employee, 45% for a foreign resident (verified 2026-05-25, ATO). That is a strong incentive to chase the declaration early.

How it is lodged now

The old paper form sent to the ATO has largely been replaced by Single Touch Payroll (STP): if your payroll software is STP Phase 2-enabled, the declaration information is reported through STP and you do not send a separate form to the ATO. You must still have the employee complete the declaration and keep it on file (verified 2026-05-25, ATO).

For a builder

  • Collect it on day one. Every new employee and apprentice completes a TFN declaration before their first pay; build it into your onboarding alongside super choice (the stapled fund process).
  • Chase a missing TFN. No TFN in 28 days means 47% withholding, which the employee will not thank you for.
  • Do not use it for subbies. Contractors are an ABN-and-invoice relationship, not a TFN declaration.

Also known as: tax file number declaration, TFN dec.

See also

Last updated: 2026-05-25. Verified: 2026-05-25. Quarterly review for currency.

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