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Shaunc

Australian business - paid in UK Tax Implications

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Hey all,

We are moving out to Oz in March on 489 visa - finally after 3 year process :). The company I work for wanted me to continue doing work for them whilst in Australia. My intention is to set myself up as self employed in Australia and do consultancy work for them. I have pretty much got this agreed with the company and to make things easiest for them, i will bill them in £ rather than $au. Currently our house is up for sale and is unlikely to be sold prior to leaving and so I was looking to get paid into a UK account prior to transferring to Oz. As i wont have a UK business set up it will only be a personal account, will this cause issues for either tax in either country or for later providing proof of work when applying for permanent visa?

Thanks to any help or advice given 🙂

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It makes no difference where the money is paid, it's where you are that matters!   

I do work for overseas clients all the time.  I'm set up as a sole trader, which means I have an ABN but otherwise, no special arrangements.  I simply declare my business income along with my personal income on my personal income tax return.  The overseas income is a bit fiddly - it would be a good idea to get a tax agent to do your tax return the first year, so you can see how it's done (the cost of the tax agent is tax deductible the following year so  lot of sole traders use one every year anyway).

You don't need to register for GST (our equivalent of VAT) unless your projected turnover is over $75,000 for the year.

I'm not clear whether you're planning to find other clients once you're in Australia?   There are laws in Australia, designed to ensure that companies don't hire casual staff instead of permanent staff (to avoid offering benefits like holidays and pensions).  The result is that if you want to be self-employed, you must make sure you're doing work for at least two or three different companies - and it's not enough to do a few hours here and there for the other companies, because if the bulk of your income comes from one company, the Tax Office will smell a rat.

Edited by Marisawright

Scot by birth, emigrated 1985 | Aussie husband applied UK spouse visa Jan 2015, granted March 2015, moved to UK May 2015 | Returned to Oz June 2016

"The stranger who comes home does not make himself at home but makes home itself strange." -- Rainer Maria Rilke

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Your company will likely know of IR35 in the U.K. and although it’s not exactly the same rules here, the same principles apply. You should both get independent advice on how this could work for you. I totally agree with Marisa about the ATO and you could be disadvantaging yourself enormously without holiday pay and Super.

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The IR35 provisions were introduced by HMRC in the UK to stop individuals using limited companies to deliver personal services and sheltering income/paying lower rates of tax on income arising from personal exertions.

The OP here is planning to be self employed - and is in Australia - so I think IR35 isn't an issue here.

Note that the OP can introduce a premium to her rate of pay and make personal super contributions if that is agreeable to both parties.

Best regards.


Managing Director, Go Matilda Visas - www.gomatilda.com

Registered Migration Agent Number 0102534; Registered Tax Agent (Australia)

Chartered Accountant (UK, and Australia)

T - 023 81 66 11 55 (UK) or 03 9935 2929 (Australia)

E - alan.collett@gomatilda.com and acollett@bdhtax.com

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The IR35 provisions were introduced by HMRC in the UK to stop individuals using limited companies to deliver personal services and sheltering income/paying lower rates of tax on income arising from personal exertions.
The OP here is planning to be self employed - and is in Australia - so I think IR35 isn't an issue here.
Note that the OP can introduce a premium to her rate of pay and make personal super contributions if that is agreeable to both parties.
Best regards.

Sorry you are quite right Alan IR35 would not be relevant, I was just trying to give them some kind of relatability so they understood there were considerations over and above what the OP and employer may be happy with. I should have just said check out PSI.

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