Happy in Oz

Hi,

I am about to see an accountant to help me complete a tax return. I worked part of the tax year in the UK and part in Oz.

Does anyone know the implications of declaring and not declaring the UK part of the year. I paid standard tax in both countries accordingly.

Also what about declaring interest earned on savings in the UK, again UK tax was paid?

I know I should declare everything but I am very fearful of a huge and unexpected bill.

Thanks for your help.

JAJ

You don't need to declare UK-source income that arose before you became Australian tax resident.

Happy in Oz

Thank you, does source income mean your job and the interest earnt on savings?
thanks again

cyclemark

Means any income from UK activities i.e. salary, interest, rental income etc.

Alan Collett

Have you completed UK tax form P85 and thereby claimed a tax repayment from HMRC? You will need to send form P45 from your last UK employment to the UK Revenue with the P85.

Form P85 can be obtained at this website (type the form number into the search box): http://www.hmrc.gov.uk

Best regards.

woodiesinaus

You will however have to declare ANY uk income from 1 July 2006 to 30 June 2007 to Centerlink, if you have a family, and they will take it into consideration when doing their calculations.
Woodies

joho

We only were only here for 3 months of our first year and they calculated everything on a 12/3 basis. Tax allowance etc.

Jo

Happy in Oz

Thanks, did that with Centrelink, one thing I am unclear about is that the accountant mentioned that after 183 days you become an Australian Tax Resident, we were over that number of days in our first year, he is also saying that I must declare my UK income from 01.07.05 to the day we arrived in November 2005, also our savings interest (both in the UK). Have an appointment tomorrow so should find out more, will tell him that JAJ said that there is no need to declare this??

Thanks everyone.
Alan, yes I did the tax claim in the UK, very small refund was issued
Thanks again

donna

We had to declare everything to the accountant and centrelink as we also worked part of the tax year in the uk.Centrelink were really fastidious and worked out what the exchange rate was for each months salary.
good luck
donna

Happy in Oz

Thanks Donna
So did you end up paying more tax here on your earnings in the UK? Was the tax return good or bad news in the end? Also why do Centrelink need to know your income if you are not claiming benefits?
Thanks again

bridie

Not sure on the 183 day thing, I would say as an Aus accountant he would know what he's on about and if you're not sure ask him to explain why.

With the savings, yes, you'll have to declare interest and pay tax on it (I assume you've told the bank that you're non-resident so they dont deduct the tax before they pay you it? If so then you just show you've already paid UK tax on it).

We arrived Oct 2005 and I just gave them details of all income from the date we landed - they never asked about previous tax or income.

Happy in Oz

thanks, bank cocked up the tax on interest in UK so it has been paid, trying to get it bank is not happening, they said you are not considered non resident until one year after you leave the uk!

donna

I think they take it into account for tax bracket reasons,ie total earnt that tax year.you wouldnt need to pay tax on it again,but it could push you into the next bracket for the OZ income that year.Having said that it made no difference to us and yes we got about $600 back from tax return.
Centrelink does pay you a benefit similiar to family allowance from the time you arrive.
hope that helps
donna

Happy in Oz

I have never been paid anything from Centrelink! Is it income related?
Thanks for your replies

donna

Theres part A and B one isnt dependant on income ,just dependant on having kids and the other one is income related.