Tax on transferring funds

[Guest kutsu]

Hi All,

 

My wife and I have our PR and looking at arriving in Australia in January, we are in the process of selling our house but would like to keep the money in a UK high interest account for a year until we settle in and decide to buy, I understand there is no tax payable in Aus as we are immigrating but is there a time limit on this, I am concerned that in a years time if we move the money over it might be taxed, does any one have any similar experiences?

 

Thanks in advance.

[flatpack]

Why not put it in a high interest account in Oz? I'm up on what rates are available in the UK but we're getting 3.85% in an instant access account with NAB, the base rate in Oz is higher than the UK so I would have thought that Oz interest rates would be higher.

 

There is also the long term exchange rates to consider, if the pound slumps against the dollar then all your gains of high interest will disappear. Conversely if the pound rallies against the dollar then you'll get double bubble!

[Guest kutsu]

Hi Flatpack,

 

That does make sense especially as though the exchange rate is "reasonable" at the moment, I guess our fear is moving over and for some reason wanting to come back to the UK in a years time, but thats another discussion

 

Thanks for the info, definitely food for though.

[scuffythetugboat]

I'd see what happens with the Scotland decision first as it would probably indicate which way the English pound will be heading. Apparently a yes vote would see it fall, but who knows. A year is a long time when it comes to currency fluctuations so either way you could do well or end up in a mess, it's your call. Personally if I was not sure about moving I would leave my money in the UK as a pound will still be a pound in a years time.

[Gbye grey sky]

Hi All,

 

My wife and I have our PR and looking at arriving in Australia in January, we are in the process of selling our house but would like to keep the money in a UK high interest account for a year until we settle in and decide to buy, I understand there is no tax payable in Aus as we are immigrating but is there a time limit on this, I am concerned that in a years time if we move the money over it might be taxed, does any one have any similar experiences?

 

Thanks in advance.

 

The money will not be taxed when you take it over a year later or indeed at any time as it is your own money nor would you be taxed on any 'profit' if the exchange rate was more favourable in January 2016 than it is in January 2015. Most forecasters predict that in the long term the £ will strengthen against the € as UK interest rates rise but there are so many variables and they could turn out to be wrong. The independence effect, conflicts with Russia, changes in Europe, China etc. etc. Presumably you will seek to have the interest paid without tax deduction so you will need to declare that income on your Oz tax return.

[QuinninOz]

Hi Kutsu,

 

I moved to Australia from the UK in 2000 - then to Canada - funny enough headed back to Australia in January as well. I have actually started moving the money to Australia because of favourable interest rates. We too are renting when we get there, and we may decide to come back to Canada but I am doing it now because I have found that being proactive with interest rates is a good idea. Wait until you need the money can catch you with your pants down. Also wanted to mention it is much better to pay tax on exchange rates than not because it means that just benefited from the exchange rate.

[Pumpkin]

Hi Kutsu,

 

I moved to Australia from the UK in 2000 - then to Canada - funny enough headed back to Australia in January as well. I have actually started moving the money to Australia because of favourable interest rates. We too are renting when we get there, and we may decide to come back to Canada but I am doing it now because I have found that being proactive with interest rates is a good idea. Wait until you need the money can catch you with your pants down. Also wanted to mention it is much better to pay tax on exchange rates than not because it means that just benefited from the exchange rate.

 

Interest rates and exchange rates will settle in am equilibrium. Higher interest rate offset by lower exchange rate. If it made sense to move money to Australia because of interest rates then no money marek or institutional fund would be in £, they would all be in A$.