julesharp Posted June 26, 2012 Share Posted June 26, 2012 hi all, my family and I are in the process of applying for our 176 visa and are unsure of tax issues regarding rental income etc. anyone know the best option to transfer the rental income over to oz, i.e let it accumulate and bring it over in lump sums as the tax may be lower? also my husband receives a war and service pension which is non taxable in UK. Is this non taxable in Australia as well? thanks Link to comment Share on other sites More sharing options...
Guest GeorgeD Posted June 27, 2012 Share Posted June 27, 2012 Don't know about the pension side of things... If you are a permanent resident or Oz Citizen, you are taxed on income earned anywhere in the world. This includes rental income from a house in the UK. Where you keep the money (UK/OZ/under the mattress!) has no bearing on whether it is taxable or not in Australia. You still need to declare it in your Oz tax return even if it's never brought into Oz. The flip side of this is that you can claim tax relief on maintenance/interest/etc you have to pay on the rental in your Oz tax return too. There is no limit or tax on bringing money in or out of Australia...the tax liability is created when you earn money, irrespective of where it is earned or kept. Move any amount between the two countries as much as you want...there is no charge from the Oz tax auhorities for doing this. You need to declare any cash going in or out at values of $10,000 or more. Declaring it and being taxed on it are two different things. This is just for international money laundering/proceeds of crime legislation, not to tax you. If you do an electronic transfer using your bank or a forex trader then it is automatically declared, basically they have had to check your ID and address at some point in the past to make sure you are who you say you are to open an account with them, so the transfer can be traced back to you. So an electronic transfer is actually also declared, you just don't know it. You will hear people saying transfer $9,999 at a time...it makes zero difference, transfer a million if you want, it costs no more as far as Oz legislation is concerned. The UK and Oz have a reciprocal tax agreement, so you won't pay double tax, but you will essentially pay the higher amount of what each country would charge...for example, if you would pay $500 tax in the UK and $800 in Oz, you will probably end up paying around $500 to the UK, and a further $300 to Oz if it is earned in the UK. You won't pay $1300. Again, you'll still pay tax to Australia even if it never reaches these shores. This is a simplistic view and I am happy to be corrected ont his by anyone who knows more about it! Link to comment Share on other sites More sharing options...
Tarby777 Posted June 27, 2012 Share Posted June 27, 2012 Julie, Regarding pensions, the general rule is that all UK pension income is taxable in Australia if you're a permanent resident. The standard thing is to transfer it over to an Oz superannuation fund under HMRC's QROPS scheme, but as your husband already draws an income from it, that might not be possible. Your best bet is to speak to the ATO as the whole pension/tax thing is quite complex. With a bit of luck, forces pensions will get special treatment... don't know. See also this thread: http://www.pomsinoz.com/forum/money-finance/154435-uk-assets.html Regards, Tarby Link to comment Share on other sites More sharing options...
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