Ken

On 04/07/2022 at 16:28, Fisher1 said:

Hi all,    I recently decided to apply for a credit card because I wanted to get airmiles rewards on my spending - it seemed like a good idea at the time. I am now an Australian citizen, have had my account with the bank in question for ten years, loads of money through it and never overdrawn.  I’ve been living at the same address in Australia for just over four years. I have a retirement income well in excess of the minimum outlined by the bank, and have most of it transferred here from the UK.  So I was gobsmacked to be told by a not-very-nice man on zoom (in the manager’s office, in place of the manager!) that I was not eligible for a credit card.     I notice they have recently changed their web page eligibility criteria to include the need for a verifiable Australian income. I’ve decided the airmiles aren’t worth it, but this seems crazy to me.   Is this typical, or are all Australian banks weird about foreign income?

You've got it all backwards. They turned you down because it's obvious that you are never going to borrow any money on that card. There's no profit in it for the bank if you aren't going to pay their extortionate interest rate. Yes they make a little bit from the vendors when you make a purchase - but they'll still do that if you use your debit card and they don't need to share that with the airmiles company.

On 09/07/2022 at 22:24, MuscleSprout said:

Hi folks - I'm a self employed book keeper in the UK and am soon to travel to Australia as a perm citizen.  As I work remotely and my work isn't time sensitive I can carry on doing this in Australia.  Has anyone else done this and has any knowledge about the tax implications?  I'm thinking I should set up a UK limited company and pay myself dividends as a director based in Australia.  If anyone can point me in the direction of a professional with some knowledge on this I'd be grateful.

 

A UK limited company is probably not the best way to do it as you'll have all the usual tax issues for the company (possibly complicated by having a non-resident director) and they'll have to register in Australia to comply with Australian payroll requirements. Most UK companies would pay someone in Australia as a contractor to avoid needing to operate an Australian payroll. Of course if your UK turnover is over the VAT threshold you'll have UK tax implications anyway.

A sole trader in Australia is the simplest option (or an Australian company if you want to keep the liability at arms length) and if under the VAT threshold wouldn't need anything to be done in the UK.

Note that to get Australian bookkeeping clients you will need to register with the Tax Practitioners Board as a BAS agent. It's illegal to give paid advice related to Australian tax (even on how to enter a GST transaction in an accounting ledger) if unregistered. Check their requirements for registration there's quite a lot of hoops to jump through.

6 hours ago, Marisawright said:

I would say "Extras" cover is essential for a family, though.  Dentists and opticians are virtually 100% private here, and very expensive.  I don't know if health insurance companies will sell you an Extras policy without hospital cover but it's worth looking at. 

Yes you can get Extras policies without hospital cover - but finding one that will cover all you Dental and optical (with or without hospital cover) is very difficult. Most have caps of only a few hundred dollars. Enough for check ups but not if you need anything done.

23 hours ago, Jon the Hat said:

The lifetime loading only kicks in at 31.  It is a scheme designed to encourage people to take out hospital cover insurance, essentially by loading 2% on top of your premiums every year after 31.  

 

Also if you take out hospital cover insurance within one year of moving to Australia you are exempted from lifetime loading. And once you've paid the loading for 10 years you don't have to pay it any more.

On 18/06/2022 at 21:45, Ausvisitor said:

That's what I thought would be the case, however will they only start to consider at the end of the period, or would they look now with the view to only lending once the period was over 

(I suppose I could always ask a bank)

A bank would probably be willing to give you an agreement in principle. What happens though is that to actually get your mortgage it has to go through the full approval process and have the loan agreed by the underwriters. If you are still in a probationary period at that point I think it would be a problem but if you can time it so that doesn't happen I can't see why you wouldn't be able to get the ball rolling before hand.

Always make sure that if you make an offer on a property that it's clearly "subject to finance" even when you have got an agreement in principle since there's no obligation on the bank to follow through on those agreements.

PS: I notice your user name is "Ausvisitor". I hope that's not an indication of your visa status or you won't be getting a mortgage! 

22 hours ago, VIC-WAIT-GAME (NO WAY HOME) said:

If its Hume City Council, according to the information available on Immi tracker, someone who applied in March 2020, took the test in March 2021 and got approved in April 2021. They attended online ceremony in October 2021 (6 months after the approval) - 19 months from submission to ceremony. 
backlog backlog and lots of backlog - no idea when things will go back to real-normal. 
To the best of my knowledge, the department and all the councils are working to their full capacity. 

As far as I know you should hear about the ceremony at least 1 month in advance. 

Find attached the upcoming ceremonies in this area (you might already have this information) -  don't know if the above information applies to you but things have geared up since then:

"To the best of my knowledge, the department and all the councils are working to their full capacity"? I can't see how that can be true.  Your own schedule shows they are only holding ceremonies on Tuesdays and not even on every Tuesday. That's an awful lot of spare capacity once you realise there are 6 other days of the week.

4 hours ago, Marisawright said:

All the big online ones work in Australia exactly the same as in the UK.  Which one do you use currently?

Even the UK favourite Sage is now available in Australia - although it's got a very small market share. The big players are Xero, MYOB, QuickBooks and Reckon (which was derived from QuickBooks as they were once the Australian licensee for the product).

8 hours ago, cstevens11 said:

I have researched every single forum possible and cannot seem to find anywhere that can confirm whether MCIOB status through the CIOB is the equivalent of the Australian Bachelor's Degree.

Here in the UK it is the equivalent, and it's the highest qualification you can get in your profession. 

Has anyone had any success? I have even tried to contact Vettasses who could not confirm!

I did my training on the job rather than doing a degree, and those training years do not count as experience, unfortunately! 

While on occasions you need a professional qualification the Australians don't rate them. In my profession the highest qualification you can have in the UK is Chartered Accountant. The technical term in the UK for an accountant who has a degree but hasn't yet taken any professional exams is "unqualified accountant". In Australia however my bachelor degree counts as a higher qualification than the professional qualification whenever I'm are asked to list my highest qualifications (I've now also got a Graduate Diploma which is higher than the bachelor degree but would still be considered lower than the Professional qualification in the UK).

1 hour ago, SSY said:

Hi

is police check one of the documentation to submit?

I do not recall having to do so during the application

It depends upon whether or not you've been overseas. If you have been since you got your PR and spent more that a certain time in one country (I forget how long) you'll have been asked for an overseas police check from that country as part of the application. I needed a UK police check as I lived in the UK for another 3 years after getting PR. You don't need to submit an Australian police check. They run those for all applicants automatically.

7 hours ago, Parley said:

That is very odd given many financial decisions have tax considerations at their heart. Eg negative gearing decisions. Seems odd to say i can talk about the financial advice but not about the tax.

You can talk about many things. But you can't charge a fee for tax advice in Australia unless you are registered with the Tax Practitioners Board (and no you can't get around that by claiming the tax advice came free with the financial services advice you charged for). Similarly you can't give financial advice unless you are licenced to do so. In some areas there's a lot more red tape in Australia than there is in the UK.

You probably need to work out if your need is more pressing for a financial advisor or a tax advisor. Financial advisors are not allowed to give advice about tax and Tax advisors are very limited in the amount of financial advice they are allowed to give (and very few have knowledge of both Australian and UK tax). Some bigger firms do employ both types of advisors but then you still have to talk to two (or more) different people.

20 hours ago, Aimee25 said:

Hi, was hoping for some advice, we currently have an EOI in for a 190 for NSW and we were unsuccessful for a 491 so not holding much hope for an invite.

I have been advised to wait for the 1st of July I’m guessing to see if my occupation or my partners occupation is on any other lists at the moment my occupation is on the south Australian list but I don’t have the years of experience, could anyone advise what is potentially going to change on the 1st of July as I’m pinning a lot on this date and want to be realistic? 
 

prob a daft question and appreciate any advice given! 
thanks 

One thing that happens is that a whole new year's quota opens up. This means if someone hasn't been granted a visa purely because the quota has been used up there's a chance that it will be granted on 1st July. This used to be a regular occurrence (my visa for example was granted on 1 July 2009 and emailed out just after midnight - it was still lunchtime on 30th June in the UK when I received it) but of course there have been so many changes to the system since then that might no longer be the case (I don't even know if EOIs have quotas but I suspect they do).

6 hours ago, partnership said:

I presume if you are on a 600 visa and there for a year you do not pay any tax. If you are on the temporary parent visa and getting a pension from Ireland would this be liable to tax or is there a double taxation agreement with Ireland?  If so how much?

There is a double taxation agreement with Ireland and under the terms of that a pension is only taxable in the country that the recipient resides. Because on a 600 visa the person is a visitor (even where it is a long visit) I would presume they would not become an Australian resident for tax purposes and so as a resident of Ireland the pension would only be taxable in Ireland.

I would however expect that the temporary parent visa would be seen differently (if you showed an intent to remain in Australia and had set up home in Australia and had sold or rented out your home in Ireland) and that you would be treated as no longer residing in Ireland and residing in Australia (for tax purposes) instead. As such you would be taxed in Australia and pay no tax in Ireland.

Ultimately though it's up to the courts to decide who is and who isn't an Australian Resident for tax purposes. At one time the holder of a Working Holiday Visa was always assumed to be non-resident but the courts threw a spanner in the works of that assumption by saying in certain circumstances a WHV holder can be an Australian Resident. You have to look at all the facts in each case and not just at what type of Visa. For example you could have a temporary parent visa but show no intent to remain in Australia and continue to maintain a home in Ireland.

As to the second part of your question - that would depend upon how much the Pension is.

PS: Just read up about the 870 visa - it's a different visa to I was thinking of (which is the one that leads on to Permanent Residency) but I don't think it changes the above much. Even if it's only extendable for 10 years you can still be a resident in that period but all the circumstances need to be looked at.

22 hours ago, Jon the Hat said:

Thanks Ken, I think though pro rated from when you arrive and become tax resident rather than the months you are working?

That's right.

4 hours ago, Jon the Hat said:

We chose to move in September.  Logic was I had a bonus paid that month, it is half way through the UK tax year so I get a rebate in the UK, and also in Australia I start work partway through the year and get a rebate as well.  This is due to tax free allowances and tax bands applying for the full year even if you only earn for part of the year.  Benefit depends on your income level, but it all helps.

Weather in Perth was nice Spring, not too hot and improving - got us all used to the heat gradually, not arriving in Jan to full 40 degree heat.  We also got to enjoy UK summer and skipped a winter   

As Quoll said the kids got a couple of months of school pre Christmas break which means they and we had made some friends before the 6 weeks holiday.

Work wise it took me 4 months to secure a role, but I was looking at a senior level where they are not that many around.  Patience paid off.

In Australia the tax free allowance is pro-rated (so you don't get the full year allowance for a part year) but for all the other tax bands you get the full amount so you'll pay a lower average tax rate than for a full year.

On 08/06/2022 at 14:20, Marisawright said:

Yes, it's just normal income like anything else, no special rates.  You may be confusing it with people who take a lump sum AFTER they've left Australia -- they get slugged with a big tax bill.  

Yes, that is the most common advice.  Once it's all sitting in the bank in Australia, it's just cash and you can transfer it immediately without any tax implications. 

As for whether there's anything to gain by leaving some or all of it in your super account -- if you're 120% sure you're never coming back to Australia, then on the face of it, there doesn't seem much point.  However, do consider what you'll do with the lump sum if you take it.  Where will you invest it in the UK?  How long before you need to access it?  I imagine wherever you invest it in the UK, you'll have to pay tax on the interest.  Whereas while it's sitting in your Australian super account, there are no tax implications until you start drawing on it as a pension. So IMO it's not entirely straightforward.

You do need to consider whether or not they ping pong back to Australia but if they do they'll still only be paying tax on the interest which may be at a low or even 0% rate depending on how much their other income is. Drawing down their capital will still be tax free so the difference is only marginal. This is compared to the more likely scenario of being in the UK and drawing down capital in their Australia super account and being taxed on it.

14 minutes ago, Don QuayPoly said:

So, after much deliberation my wife and I have decided to return to the UK to be closer to friends/relations and grandchildren. I came to Oz 14 years ago and my wife is Australian with Right-of-Abode in the UK. We are both just 60 years old.

I would really appreciate any advice on the following-

My wife has a Defined Benefit super bringing in a regular tax free (in Aus) income every month which I believe she would be crazy to cash-in or alter in any way. So if we left it here (Aus) and transferred that monthly payment over to the UK each month that would I assume be taxable by the UK tax man. My question is - is this taxed in the normal way as income, or is it taxed at a higher rate. I've seen it mentioned on here that the tax man takes 30-40% ? 

Apart from the Defined Benefit, we also have a large some in our Defined Contribution super accounts, and I believe the common advice is to withdraw it all as a lump sum while still resident in Aus, before then transferring it over to the UK as "savings" which would be tax free.

My question is - is there anything to be gained by leaving some or all of it in Aus in the super account, or would it make financial sense to take the cash over as savings, then re-invest over in the UK ?

Thanks all .

Don

 

 

Under the terms of the double taxation agreement between the UK and Australia Pensions are taxed where the recipient is resident. That means an Australian pension (Super) would be taxed in the UK once you return there. But there are no special tax rates it is just taxed as normal income and you still have a tax free threshold and then the lowest tax rate. The 30%-40% rates that people quote only apply where people have already used up all of their 0% and 20% thresholds on other income.

Yes you will want to withdraw you funds from Super while it's tax free to do so. If you withdraw funds from Super while resident in the UK the whole amount withdrawn is taxed as income as it is treated as a pension. If you invest the money in the UK (or in Australia for that matter - but then you have to deal with Australian tax as well as UK tax) you only have to pay tax on the amount the investment grows but the original capital you invested remains tax free.

If you put the money in an Australian bank account or somewhere else that only earn interest or royalties as a foreign resident you only have to pay a 10% withholding tax (make sure your bank knows when you become a foreign resident as if they don't withhold when they should it can be a pain to sort out) which you can reclaim from your UK tax due and won't have to do an Australian tax return. With other investments you may still need to file an Australian tax return and as a non-resident won't get a tax free allowance (but will still be able to deduct the tax paid on your UK tax return so that may not matter).

18 hours ago, ClareU said:

HI,

I am hoping someone can please give me some guidance and answer a few questions regarding taking a lump sum in the UK and declaring the tax in the UK and AU.

I am a duel British/Australian citizen living in Australia since 2002. Having turned 60 I have a UK PP in the amount of 18,000 GBP to access. The money is only available as a lump sum or as an annuity so I want to take the full amount. I know that the first 25% of the value of the fund is tax free so I should receive 4,500 before being taxed. I am told that the remaining 75% will be taxed at 40% so that would leave me with an additional 8,100 GBP. I am assuming I declare this amount but converted in AU $ on my tax return, so around $22,000. My first question is: can I deduct from this, the amount that was in the fund before I became resident in Australia?

My next questions are: Once I receive the funds, do I apply to HMRC for a tax rebate on the basis that I should have been taxed on a lower income threshold? And also, if I then receive a rebate do I also declare that on my Australian tax return? Finally, can I offset all the tax I end up paying in the UK? I have not earned an income either here or in the UK for the last couple of years.

Hope this is laid out clearly enough to make sense, I am finding it pretty confusing!

Many thanks for any assistance you can provide!
 

Under the terms of the double taxation agreement between the UK and Australia, Pensions of Australian residents are taxed in Australia not the UK so you should not have to pay any tax in the UK. That means you need to apply to HMRC for a refund. Unfortunately you can't just apply directly. You get the form from HMRC DT Individual Australia (publishing.service.gov.uk) but then have to send it to the ATO to be certified and they then send it to HMRC. The process takes months (and to slow things down further HMRC send the refund by cheque).

In Australia you have to declare the whole 18,000 GBP (converted to AUD) but only the growth since moving to Australia (called AFE - Assessable Foreign Income) should be taxable (so yes you can deduct the value in the fund when you became resident in Australia) and so is reported as income (section 20 of your tax return). The remainder is reported as Target Foreign Income (IT4).

You may well find that you need to lodge your Australian Tax Return before you receive the refund from HMRC. In that case you can report the tax paid and lodge an amended tax return when the refund is received. If the amounts of tax refunded by the ATO (and subsequently needing to be repaid when the amended return is lodged) are large they could charge interest.

You can do all this yourself but Professional advice to make sure this does apply in your circumstances is a very good idea - and normally a lot cheaper than @can1983 suggests!

PS: if you are able to delay receiving this income until July it will fall into next tax year and delay when you have to pay the Australian tax for a year (significantly improving your chances of having already received your UK tax back).

10 hours ago, sharon h said:

How hard is it now to get a mortgage in Australia if you are over 50, and is there any way of getting the mortgage from the UK for a property you intend to live in if you are a permanent resident

Doesn't seem to make any difference at all. I'm closer to 60 than 50 but the bank was still perfectly happy to give us a 30 year mortgage (I have my own plans for paying it off a lot sooner though). I would have thought they need something in their affordability model to account for declining income in retirement but it's all based on what you are earning (and spending) now and assumes that will all remain unchanged for the next 30 years.

14 hours ago, Onward said:

We're not really big city people. I lived in Toronto for a few years when I was a young man and it was a lot of fun at the time. Even then the traffic was absolutely dreadful, now it's even worse. Big cities come with a substantial cost of living. I remember having to pay to park multiple times per day, even just to the grocery store or to pick up dry cleaning. Basically, there was only time during the weekdays to work and commute. Depending on your line of work, the frenetic pace in Toronto can be really motivating, however.

Sydney is absolutely a fantastic world-class city, so I'm not going to say that I wouldn't want to live there, only that I can't. 

My family and I absolutely love the beach and ocean. Living in Canada, I'd work 48 or 49 weeks out the year and the rest of the time, in the winter, we'd travel to a warm locale like Hawaii with a beautiful beach to recharge. 

Moving to Australia is a little bit of flipping that ratio around. Why not live in a place that has what you really want rather than visiting the beach a few weeks per year?

We're lucky to be going on this adventure and will appreciate and enjoy it as long as it lasts.

Even though a Geelong winter is nothing like a Canadian winter you'll probably find you'll want to spend a couple of weeks in Queensland in mid winter. Most Victorians seem to.

5 hours ago, Onward said:

Also, we can’t even seem to get a post office box prior to arrival as it seems you have to present in person and show id. This leaves us without an address to forward our mail.

I was able to rent a post office box in Queensland while still living in Victoria. I only had to show id when I collected the keys. This allowed me to forward my mail from Victoria to Queensland even though I wasn't in possession of the keys (but then since I wasn't in Queensland to collect the mail why would I need the keys?).

On 29/05/2022 at 18:05, Marisawright said:

As answered on another thread, it's treated as income.  However you'll get a tax-free threshold, which is currenlty $18,200 a year.  That means that anything you earn up to that amount is not subject to tax at all.  It's only income above $18,200 that is taxed.  There are other offsets and expenses you may be able to claim too, but they will depend on your individual circumstances. 

There is a Low Income Tax Offset of $700 (this year there's also a Low and Middle Income Tax Offset but it's supposed to be the final year - have to wait for the Labour party budget).

This mean anyone whose income is less than $21,884 will end up paying no tax at all because the offset covers their tax bill (and in 2022 with the minimum LMITO of $675 anyone earning less than $25,436 will end up paying no tax at all - although there will be a small amount of Medicare Levy to pay).

As you've said there are other offsets and expenses (the most relevant when talking about pensions is whether or not the pensioner is entitled to SAPTO - the Senior and pensioners tax offset which not only is an offset in it's own right but gives a bigger tax free threshold for the Medicare levy) which will allow more income before paying any tax.

Most of the allowable deductions for expenses are work related. One that isn't is your tax agent fee, so even if your income is $1million just pay me $1million and it's all going to be tax free and I'll be able to get a refund of any tax you've paid! Some people are so obsessed with paying less tax and/or the size of their refund they'll probably think that's a good deal and not a joke!

On 20/05/2022 at 11:27, Jon the Hat said:

And I guess always make absolutely sure your offer on a property is subject to finance approval.  This might be standard in some states, but I am not sure it is everywhere.

The original quote mentioned bidding on a house. When buying at auction you can't place a bid that is subject to finance approval as all bids are final. It's why I'd never buy at auction (if in need of a mortgage) as no matter how sound the bank's offer looks they always have a get out clause. A buyer who defaults has no such get out and will be left out of pocket.

On 29/05/2022 at 14:45, VIC-WAIT-GAME (NO WAY HOME) said:

Could someone please suggest if online passport application is better or paper application? 
Which one is less time consuming?
And how long is it taking to get the new passport these days? (Passport office says allow up to 6 weeks)

 

Thanks

ABC news report today says that there's a backlog at the passport office. Renewals are taking 6 weeks and new passports and child passports are taking longer.

Lengthy passport delays cause anguish for expectant travellers - ABC News

22 hours ago, Simarjot said:

Hi Guys,

I applied for citizenship on 1st July 2021 along with my 2 kids, my husband  applied on 15th July 2021.He got invitations for test on 28/09/2021.His test was on 28/10/2021 got approval 2 weeks later .I got invitation for test on 26/10/2021 and test was on 3/11/2021.passed test with 100% .Got approval within 5 minutes.

finally today our whole family got invitation for ceremony on 8th June (Gold Coast city council ).11 months from application to ceremony.

paper application submitted at Brisbane immigration office.

wish you all the very best .

11 months from application to ceremony is back to pre-covid timescales. Excellent news for everyone (assuming your timescale is the average and not an outlier).