Stocks & Shares ISA

[sunnysomerset01]

Hello, I have some money in Stocks and Shares ISA here in UK

Moving back to Oz mide next year. Not sure if it will be for good or not (dual citizen).

What happens if I leave the S&S ISA money here?

Will I pay tax on it if it just sits and grows?

Will I pay tax on it when I sell? (Assuming I'm in Oz).

What happens if I just leave it to grow, then return to the UK after 10 years? And then sell them (to live off). Will I have to pay CGT to Aus Govt?

thanks! 

[Kenfrapin]

Hey there

We've left our ISAs as is back in the UK. You are allowed to keep your ISA when you leave UK but cant invest new money if you arent a UK resident for tax purposes

As its money we dont really need, it can continue to grow until a time we want to use it in Oz. Havent checked tax implications but it is tax free in the UK, which is the whole concept of an ISA wrapper. There is a tax arrangement between UK and Aus as well so we arent double taxed. You've paid UK tax on the money before it went into the ISA, there are no capital gains on this when you sell as per UK tax laws

What we havent checked is if we sell it when we are in Aus, then is this considered as income by Aus? Pretty sure if we leave Aus and move back to the UK and sell it then it wont be taxed, as we are no longer resident in Aus for tax purposes

Cheers

KnK 

[Ken]

On 21/11/2019 at 13:18, Kenfrapin said:

Hey there

We've left our ISAs as is back in the UK. You are allowed to keep your ISA when you leave UK but cant invest new money if you arent a UK resident for tax purposes

As its money we dont really need, it can continue to grow until a time we want to use it in Oz. Havent checked tax implications but it is tax free in the UK, which is the whole concept of an ISA wrapper. There is a tax arrangement between UK and Aus as well so we arent double taxed. You've paid UK tax on the money before it went into the ISA, there are no capital gains on this when you sell as per UK tax laws

What we havent checked is if we sell it when we are in Aus, then is this considered as income by Aus? Pretty sure if we leave Aus and move back to the UK and sell it then it wont be taxed, as we are no longer resident in Aus for tax purposes

Cheers

KnK 

If you sold while in Aus then it would be subject to Capital gains on the gain made between you becoming permanently Tax resident and the date of sale. The double taxation agreement means you can deduct the tax paid in the UK from the tax due in Aus and so only have to pay tax in Aus where the Aus rate is higher. All very well except when it's tax free in the UK that means you still have to pay the full amount of Aus Tax! Permanently leaving Aus is also a Capital Gains Tax trigger. You should pay Capital Gains Tax on the gain your ISA made at that point (even though still unrealised). I doubt many people do actually pay up - but that's what the rules say and as information sharing between different tax authorities grows all the time then sooner or later the ATO will pursue this.