Tarby777

Hi all, My wife will start to receive her UK state pension this year, and she will reach the qualifying age for the Aussie state pension 12 months later. We've sent off the paperwork to HMRC to start the ball rolling, but I'm wondering what to do for the best when the time comes that we're able to apply for the Aussie pension. She'll get pretty much the maximum UK pension but IIRC it isn't index-linked if you live outside the UK. the Aussie pension is income- and asset-tested and I imagine that her UK pension would be seen as foreign income that would reduce her entitlement to the Aussie pension, as would her super balance. The idea of cashing out on super and paying down the mortgage has crossed our minds. We're UK and and Aussie citizens, living in Oz 100% of the time. I'll still be working for a few years. So many things to consider! How have others navigated this stage of life? TIA Tarby

For good schools, think about the north shore (Kirribilli to Hornsby) or the Eastern Suburbs. "Good" meaning world-class $15-30K per child per year! There are probably decent schools all over the city to be honest, but those two areas probably have the best reputations schools-wise. Walking distance might be an issue though... it's a city of 5 million people after all and the schools are spread out. Not to pee on your chips but commuting by car is an absolute nightmare here... unbelievably clogged roads and some expensive tolls. 45 minutes is an unattainable dream for a *lot* of people. I would advise you to do everything possible to set up close to a train station, ferry wharf or decent bus route if a shortish commute is a must-have. BTW, you were right - there is a fast ferry - about 18 minutes to the city.

Rather than rush it, can't you just make your initial entry into Australia before the 4 years is up, and go straight back to Blighty again? Maybe make a holiday of it and buy yourself some time before making a decision... with any luck, the family will fall in love with the place during the holiday. You'll probably want to look into a resident return visa as well, because once you have clocked up 4 years since the PR visa was granted, you lose your ability to get back into Australia from abroad (although you can still *stay* in Oz indefinitely... you just can't leave and come back to Oz on your PR visa once 4 years ticks over). I know this puts me at odds with what others have said, but my opinion is that Oz is infinitely better than the UK in just about every respect. Quality of life - for me, at least - is off the scale compared to the UK... The "it's not better... it's just different" thing hasn't been my experience at all. Sorry! Best thing I ever did and I wish I'd done it 20 years sooner. Would your family at least commit to a 2 year experiment with the promise they can go home at the end if they want to?

This place is the real deal next time you're in Warners Bay (Lake Macquarie): Currently up for sale, but still trading... run by a Scottish family. As British a chippy as you'll find anywhere.

I don't think you'll be waiting long. My citizenship was granted last year and it took around 4 months (max) before getting a date at North Sydney.

I paid for the services of a migration agent who had previously worked in my industry (IT), which was a great help. If you can find one with a background in construction / fabrication etc, they will be able to give expert advice on your chances, and will know how best to structure your application. Failing that, get yourself along to one of those "moving to Australia" fairs (assuming they're still a regular thing in the UK). You get a good mix of government reps and employers at those events.

There are tax advantages to *not* having PR. All your worldwide income becomes taxable in Australia once you have it, so income from UK investments, properties etc has to be declared here. I got PR sorted before leaving England but that's only because I was close to the cutoff age for PR (45) and I figured that if I came on a 457 and loved it, I would have been broken-hearted if I subsequently struggled to get PR. Unless you're close to 45 or your trade is at risk of dropping off the critical skills list, I wouldn't bother with PR yet.

Even 35 years doesn't guarantee a full pension... if you contracted out of SERPS at any stage, it counts against you.

Thanks Alan. I'll have one last attempt at getting my head round all of this unaided, but I suspect I might be calling on your services soon

Thanks Lisa. Was this the UK and/or Aussie taxman? Did you check with both?

Hey folks, Sorry, but I still haven't quite got my head round this, and I need to as I'm in the same boat as Lisa. Just to spell it out for this thicko (me)... let's say this is a simple case where the property was the vendor's main UK residence until emigration and it has been let or available for let from then until the sale. Are we saying the taxable gain is essentially (sale proceeds - valuation as at April 6,2015), or (sale proceeds - valuation when leaving the UK), or something else? I get that other factors come into play (e.g. relief to reduce the taxable amount), but I'd like to at least understand the absolute basics of the calc. I've been trying to work through the example at [TABLE=width: 75] [TR] [TD=width: 75]https://www.gov.uk/capital-gains-tax-for-non-residents-uk-residential-property[/TD] [/TR] [/TABLE] and it has confused the heck out of me. As an aside: Alan, would you be one of the people you mentioned (an accountant able to handle the UK and Aussie side of things in this situation)? TIA Nick

Thanks all. Mine will expire on November 24 and I'm planning to fly out in early October, returning by mid-October. Is that too close to take a chance or would I be OK right up to the cutoff date?

G'day folks, I'm hoping this is an urban myth but I've a vague memory of a story about someone who had been living in Australia on a PR visa for long enough to become a citizen, and they hadn't got round to applying for citizenship. They flew to their home country for a short break and had trouble getting back into Oz on their return. IIRC, there weren't any issues around their foreign passport approaching its expiry date... it was something else, something specifically to do with them having been in Oz long enough for citizenship and not having gone for it. Does that ring any bells? TIA Tarby

No mate, no joy with that one unfortunately. It's not such a big deal for me though... my UK property is 50/50 with my wife and she doesn't work so I'm only getting clobbered on my half of the rental income, and we've only got about a year to go before the mortgage is paid and we'll sell up at that point. If we had longer left on the mortgage and the ATO were going to be hammering the rental income for a longer period then I might have pursued it further, but as it is, I just can't be bothered TBH. Anyway, I can still offset repairs, insurance, agent fees etc against the tax, so it's not a total disaster... it's just not as tax-efficient as it would be if I had those depreciation reports coming in. Never mind... at least the exchange rate seems to be heading in the right direction for once! Cheers, Tarby

Hi all, My wife paid into several pensions in the UK, which we have recently transferred to an Aussie QROPS. The age at which one can normally draw on an Australian super fund without any tax implications is 60, but my wife's date of birth (11/57) means that she reaches what the ATO refer to as her "age of preservation" this year, when she will be 55 (it is later for people born from 1960 onwards). Given her DoB, she is able to access her super from age 55 and will not have to pay any tax in Australia as long as the total withdrawn doesn't exceed 160K AUD before the age of 60. However, I know that super fund providers are legally bound to report withdrawals to HMRC for a period of 10 years following a QROPS transfer, and I'm aware of the possibility of HMRC charging tax on withdrawals from Aussie super funds if the money came from the UK. Moving forward a couple of months... my wife will reach her age of preservation and she will have tax-free access to her super as far as the ATO is concerned. If she were to start drawing on her super - which is comprised purely of funds that came over from the UK in 2012 - might she be liable for tax to HMRC? (BTW: I've already asked this question to HMRC. They said that can't comment on "an individual's circumstances"!) TIA Tarby

If you don't fancy doing the paperwork / legwork yourself and want a professional to do it for a fixed fee rather than a %age of the pot, I can recommend John Horvath at Gold Vision in Perth. His is a transfer-only service - that is, no advice... no comparison of the benefits of your existing UK pensions vs the super fund you're planning to do the QROPS transfer into. So if you've made up your mind to transfer everything over, and you don't want the hassle of doing it yourself, give him a shout. He has a deal that is something like $750 for 5-6 policies. He provides all the figures you need to supply to your super fund, so that (if you've been in Oz longer than 6 months when you do the transfer) they can pay the tax on the growth at 15% rather than at your marginal rate.

Hi all, Having established in recent threads that depreciation reports are a great way to minimise tax on rental income, I'm really struggling to find a company in the UK that is aware of the ATO's requirements for such a survey, or is even familiar with the idea of depreciation reports for domestic properties. I've tried e-mailing two different guys at Davis Langdon, which is the only UK company I could find who seem to offer the service, but I've not had a reply from either of them. So: does anyone here have a UK rental property for which they've been able to get a depreciation report done to ATO standards, for use in their Aussie tax return? TIA Tarby

Thanks Eera, I've contacted that company in England, and am now waiting to hear back from them. Funnily enough though, even among Aussie friends who have investment properties, I'm struggling to find one who is familiar with the use of a depreciation survey to reduce tax paid on rental income... I spoke to one this morning and he had heard of them being used as a means to reduce CGT when you sell the property, but not as something you could use to reduce tax on rental income over a period of years. In your experience, is it a widely-used strategy or is it closer to something that is hidden away in small print and in a bit of a grey area as far as the ATO is concerned? I'm keen to take advantage of it, but it isn't an area of expertise for me by any means and I don't want it to come back and bite me... TIA Tarby

Hi all, I know that if you lodge your own tax return, you have to do it by October 31st, but what is the rule around due dates for paying a tax bill to the ATO? I've trawled round their website, but I can't find anything there that tells me. I'm curious to learn whether it's x days from the date of lodgement, or a fixed date, or that it varies from case to case. I see that in the case of returns submitted for individuals by tax professionals, it is determined by the lodgement date - I just don't know what the score is for individuals who are submitting their own return... TIA Tarby

...in which case I apologise; didn't intend to quote you out of context. Sorry about that. I just didn't care for your tone.

Barking to you, perhaps. It's a choice between 1) 2% UK savings interest swallowed up by 2% mortgage interest, and nothing to claim against on an ATO tax return 2) 6% Aussie savings interest which I am then free to throw at the mortgage, and some mortgage interest to claim against on the ATO tax return. ...and I'm not paying tax on the savings interest. They're in my wife's name, and she doesn't work.

I've been through exactly the same dilemma, and in the end I brought my money over to Oz. My thinking is that interest on the mortgage is 2%-ish (so my UK savings offsetting the mortgage were effectively making 2%), the best Aussie savings accounts are 6%-ish and I always have the option of sending some savings account interest back to Blighty to start offsetting again or to make an over-payment. I'm at the mercy of exchange rate variations, but I only see them going one way for the time being. Everyone's situation is different... we're coming towards the end of our mortgage term so it isn't accruing much interest and our rental income (split between myself and Mrs Tarby777 for tax purposes) is within the HMRC tax-free allowance. I am really liking the sound of the depreciation schedule... you might like to check a recent thread that I started where people gave examples of how much it saves them. Whether you can do one for a UK property, I don't know... I just checked with my managing agent, and he hasn't heard of them...

The sooner you move it over here, the sooner you'll start getting very nice interest payments into your Aussie high-yield online account every month, and dreams of "what might have been if only the exchange rates were better" will start to fade. RAMS are doing a very nice one at the moment... I just moved my shekels over to them from Ubank... Trust me, the pain does subside! If you can't bear to do it all in one then you could drip-feed it over a couple of years, but I don't see the exchange rate moving in your favour any time soon...

I took professional advice when I emigrated and was strongly encouraged to keep on paying. You should be able to pay class 2 NICs, which are only tuppence ha'penny in the grand scheme of things (only around 10GBP per month). It's a low-cost investment for a guaranteed return. I guess everyone's situation is different... as things stand, you'd still get 24/30 of the basic UK state pension even if you stopped paying, and so I suppose you have to think about how much you will be relying on HMRC for your retirement income, and whether the extra that you will pay now justifies the extra return. Personally, I think it's more important to think about any personal/company pensions you have, and to get them transferred over to Oz quick sticks under the QROPS scheme once you are granted PR. UK pension income is taxable in Oz, whereas income from super is generally tax-free, and you can access it sooner. You get a 6-month grace period on pension transfers after which any growth in a UK pension becomes taxable in Oz when you transfer it over, so it's best not to hang about...

Mate, my understanding from a recent phone conversation with HMRC is that your liability to CGT doesn't depend in any way on whether the property has been rented out or not. They told me that you won't be liable if either: 1) You sell within 3 years of leaving the UK, or 2) You eventually rack up 5 years as an Australian resident HTH Tarby