Contemplating your move to Australia? Already here? If you're planning to work in Australia as a temporary or permanent resident, understanding Australian tax and how tax rules apply to you can make a big difference to your hip pocket.
Planning your tax may be fairly low on your to-do list, but having a strategy can help you take advantage of opportunities that exist for expats - and help you avoid some of the traps that can prove costly if you don't comply.
Australia welcomes a significant number of temporary residents each year, seconded here by their employers or as professionals seeking experience of working in their chosen field in Australia.
Salary packaging, share options, and other employment-related taxation requirements are just some of the things you or your employer will need to consider. Of course getting advice from an Australian tax specialist] is recommended before you make your move or once you get here, because they are able to help you understand whether you're eligible for some of the benefits below.
If you've decided to take up permanent residency in Australia, then your taxation position in Australia changes significantly.
You'll be subject to tax on your worldwide income, your foreign assets may become subject to capital gains tax, and you'll be subject to anti-tax deferral rules. You'll also be ineligible for the Living Away from Home Allowance and be subject to the Medicare Levy and surcharge.
You will, however, also gain access to a whole range of benefits as a permanent resident. Some of these include:
As a permanent resident, however you'll also have to consider:
- The tax implications of having property and investments overseas
- Health insurance to avoid the Medicare levy exemption
- Investing in Superannuation
- Transferring your pensions to Australia
Australian tax can be complex whether you're a temporary or permanent resident and getting advice will smooth the process. The ideal situation is to plan before you make your move to Australia, however even if you're here already, having the right advice for your circumstance will help you to plan and manage your tax obligations.