If we become foreign tax residents can we still access our Aus super tax free?

[Lammie]

Hi PiO, very quick question if anyone can help.

Hubby and I are both Aus citizens (me originally a Pom) who are planning to move to the UK for 2-3 years later this year for family reasons. We will both turn 60 while we're over there and were wondering what would happen if either of us accessed our Aus Super funds while in the UK.

I know it's completely tax free here in Aus, and if we access it while we're UK tax residents then we'll have to pay tax over there. I just wanted to clarify what happens with the ATO. As we would be classed as foreign residents for tax purposes, does this mean that we'd have to pay 32.5% Australian tax on any super withdrawals? Clearly if that's the case then we won't touch it until we return to Aus.

Thanks in advance.

[Marisawright]

1 hour ago, Lammie said:

I know it's completely tax free here in Aus, and if we access it while we're UK tax residents then we'll have to pay tax over there. I just wanted to clarify what happens with the ATO. As we would be classed as foreign residents for tax purposes, does this mean that we'd have to pay 32.5% Australian tax on any super withdrawals?

It doesn't matter to the ATO where you live, your super withdrawal will be tax-free.

It's the British taxman you have to worry about.  Your super withdrawals will be treated as ordinary income.  How much tax you pay will depend how much you withdraw, and whether that pushes you into a higher tax bracket.

[Lammie]

On 08/01/2024 at 15:38, Marisawright said:

It doesn't matter to the ATO where you live, your super withdrawal will be tax-free.

It's the British taxman you have to worry about.  Your super withdrawals will be treated as ordinary income.  How much tax you pay will depend how much you withdraw, and whether that pushes you into a higher tax bracket.

Thank you, that's good to know.

I knew our super would be taxable by the UK government if we accessed it while we were living there. I don't intend to, but it's just in case I had to stop working at some point to look after my dad.

I remember reading on a previous post that if we rented out our home here we'd get stung for 32.5% as foreign residents, so I didn't want to find out that was going to happen to our super too.