pscotty

Can anyone help. We have a couple of mortgage endowment policies that have 4 years left to run. We don't want to cash them in and lose money, but on the other hand we don't want to lose half in tax when we transfer it to Oz.
We have asked the Australian tax office, who seem unsure and just gave us the tax table, which we are not sure whether it applies to this type of saving or not.
Has anyone been through this already, or can anyone recommend a good source for tax advice.
Many thanks for any advice!

Fardell

My guess is that the net gain (if that applies) on each of the policies will be caught within the foreign investment fund tax guidelines (FIF) - a truly horrible piece of legislation. That means that in principle you will have to include the annual net capital gain (even if unrealised) in our yearly tax return. 99% of Australian tax accountants have no idea (nor wish to have any idea) regarding FIF liability - when it applies and how to calculate it. I think you'll find a number of tax accountants menioned on these forums if you do a search on FIF, otherwise PM me and I will give the addess of a company I used a few years ago. Before you incur any fees though I would be tempted to go back to the ATO and ask for someone who knows about FIF - they do exist (somewhere)! You might also need a financial planner to calculate whether you are better off, or not, retaining them, regardless ofFIF.

renth

You ought to investigate both the surrender value and the resale value of your policies. I was pleasantly surprised with mine and flogged them before I left.

Grayling

As mentioned....the annual growth is considered as income and you are taxed accordingly.

There is a tax free limit for FIFs but you really need expert advice.

G

moneypenny20

Definitely worth finding their worth before making any decision.

worzel

A question for a financial advisor rather than an internet forum. The difference between surrender value and allowing it to mature could be significant.