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scubacam

Premium Bonds

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Hi everyone, 

 

My husband and I were just wondering if there was an equivalent to Premium Bonds by NS&i  over in aus ?

 

Thank you

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No


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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On 01/11/2020 at 20:58, scubacam said:

Hi everyone, 

 

My husband and I were just wondering if there was an equivalent to Premium Bonds by NS&i  over in aus ?

 

Thank you

I can't see why anyone would choose premium bonds. For the majority of holders it's just giving your cash to the government to hold on to for no reward whatsoever

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32 minutes ago, Ausvisitor said:

I can't see why anyone would choose premium bonds. For the majority of holders it's just giving your cash to the government to hold on to for no reward whatsoever

We have done very well out of premium bond wins in the past, certainly had a competitive  return on our money through  just giving our cash for the government to hold, and there was always the very slim chance of the big one! Not such a good investment now sadly since the prize money etc reduced.

Our daughter had very few premium bonds but the number of times she won was totally out of proportion to the amount held.

Edited by ramot
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14 hours ago, Ausvisitor said:

I can't see why anyone would choose premium bonds. For the majority of holders it's just giving your cash to the government to hold on to for no reward whatsoever

In the current climate, where interest rates are so low, you can actually get a better return from premium bonds than you can from leaving your money in the bank.


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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You can still do premium bonds from Australia if you want, Australians regularly feature in the winners.  Even with the drop in prizes in December, it's still equivalent to 1% which is a good deal better than most savings accounts.

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Had a GPB25 win just this month, probably a sight more than the monthly return on my Term Deposit with a much larger amount.

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You do know the winnings are taxable in Aus........just saying


So many wineries ......so little time :yes:

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Tbh, i’m not looking forward to my first tax return.

Premium Bonds are no different to any other savings account / investment in Australia though?

I’ve not found any tax-free savings accounts out here yet.

Edited by mt9754

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19 minutes ago, mt9754 said:

Tbh, i’m not looking forward to my first tax return.

Premium Bonds are no different to any other savings account / investment in Australia though?

That's true, it's just income like anything else.  

Go to a tax agent for your first tax return.  If you don't have any overlap (i.e., you had income in the UK while you were there, then you moved, and you've had no income from the UK since you arrived in Australia) - then just go to a cheap local tax agent to do your Australian tax return.   It won't cost much, it's tax deductible, you can see how they handle it, and then you'll know what to do in future. 

If you do have overlap, then you might want to contact someone like @Alan Collett who understands both tax systems and knows how they interact. It may well be that once you see what he does, you can DIY in future years, but it's good to have a professional sort it out first time. 

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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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25 minutes ago, mt9754 said:

I’ve not found any tax-free savings accounts out here yet.

There aren't any.  The way to reduce tax is to salary-sacrifice into your superannuation (which gives you a tax-free lump sum or pension when you retire).  The downside is that you can't get the money out of your super fund until you reach preservation age.

A novated lease (leasing a car through your employer) is another very effective way to reduce tax, provided you expect to drive more than 10,000km a year.  The car doesn't have to be for business use. 

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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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On 04/11/2020 at 19:27, Ausvisitor said:

I can't see why anyone would choose premium bonds.

Because the prizes are tax-free for UK residents - although I'm not sure in Australia whether they would be classed as winnings or income. Either way I think they're taxable over here.
Your investment is also fully protected the British government, which is never a bad thing.

On the downside you'd need a decent-size holding to get a return anywhere near 1.4% (£10,000+). If you only have a £1,000 invested then there's more chance that you won't win a single prize in any given year, than that you will.

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2 hours ago, Wanderer Returns said:

Because the prizes are tax-free for UK residents - although I'm not sure in Australia whether they would be classed as winnings or income. Either way I think they're taxable over here.
Your investment is also fully protected the British government, which is never a bad thing.

On the downside you'd need a decent-size holding to get a return anywhere near 1.4% (£10,000+). If you only have a £1,000 invested then there's more chance that you won't win a single prize in any given year, than that you will.

I read somewhere that you had the best chance of winning prizes in a£2,000 block holding  rather than larger holdings. No idea if that was true,, but love to see someone with the old £ 1 premium bond holding  still winning something. yes you could buy them originally for £1.

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3 hours ago, ramot said:

I read somewhere that you had the best chance of winning prizes in a£2,000 block holding  rather than larger holdings. No idea if that was true,, but love to see someone with the old £ 1 premium bond holding  still winning something. yes you could buy them originally for £1.

@ramot back in the good old days (80s/90s) £2,000 was the largest block and you could have up to £10,000, which I did for many years. I always won between £500-£1,000 per annum so it was a pretty good investment. Mostly £50s and £100, but I scored a £500 on one occasion. The whole large/small blocks thing was a bit of an urban myth - it makes no odds to the odds - and I recall NS&I even making a statement at some point in their premium bond literature to clarify the matter.

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On 07/11/2020 at 14:09, Wanderer Returns said:

Because the prizes are tax-free for UK residents - although I'm not sure in Australia whether they would be classed as winnings or income. Either way I think they're taxable over here.
Your investment is also fully protected the British government, which is never a bad thing.

On the downside you'd need a decent-size holding to get a return anywhere near 1.4% (£10,000+). If you only have a £1,000 invested then there's more chance that you won't win a single prize in any given year, than that you will.

They count as foreign income not winnings in Australia. Because your investment isn't at risk it doesn't count as gambling. 

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Chartered Accountant (England & Wales); Registered Tax Agent & Fellow of The Tax Institute (Australia)

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