touchingcloth

Hi,

I'm thinking of leaving my shares ISA in place when I move to Oz.

Do you think the IR will find out...and tax me? (even if I don't mention it on my tax return)

If they do....will they tax me on the difference in the value when I moved and when I sold....

OR

would they me as nasty as to tax me on the full amount of Capital Gains?

Thanks
TC

thebears

Your question should be more framed on what alternatives do i have with my Share ISA's.

Whether you admit to holding them or not comes down to Tax Evasion Versus Tax Avoidance. Tax Avoidance is legal allowing the tax payer to make the best tax arrangements within the legal framework. Tax Evasion is deliberately committing fraud. The amount is less important than the action in the eyes of the IR. If you committ evasion you will never be out of their spot light.

If you have a tax liability my advice is dont question will or will not they find out - If they do your a marked man/women.

Take professional investment advice after defining the Australian tax consequences for holding ISA's.

Without providing specific advice - we sold our shares this week and are transferring the money into a trust fund for our daughter (held offshore)

Shane

spottydog

I haven't worked in PEP's/ISA's for a few years now but it used to be that you could continue to hold your PEP/ISA with its tax benefits if you left the UK but you could not open any new account or add funds to an existing account.

Australia however I imagine would want it declaring as income and would tax you on it.

Probably best to seek professional advice on this one so you don't get it wrong.

touchingcloth

but its not income until one cashes in on it!

thebears

Exactly so your question is should I sell now or after I relocate to Aust. Once in Australia you would become tax resident and liable for income on "world wide income". The selling of the shares then looses its tax wrapper status, as in Australian tax there is no ISA limitations.

Grayling

According to the ATO it is.

You are taxed on the annual growth as if it is income.

There are some allowance but you are better taking professional advice.

I do not think it is a good idea to break the law if you do not have citizenship.

G

Grayling

All annual interest or growth on overseas investments is counted as annual income by the ATO. This includes endowments etc.

Best take advice.

G

spottydog

I would expect the share dividends to be classed as income even if you don't remove them from the ISA (in the same way as interest on your bank account is even if you don't remove it from the bank). When you cash the shares in then the difference between buying (or possibly in this case emigration) and selling price is Capital Gain rather than income as far as I'm aware.

caleb2003

I have accumulating funds of which i see grow but never touch the money so dont have to declare them in UK, if the above is true then i'm going to be losing big time.

if say the funds went up by £20k in 1 year then ATO would want to tax me on that, where would i get the money from to pay them if i never draw on the funds.

Jeez I hope i'm reading this wrong cos i might seriously rethink this whole oz thing if its true, because whilst i was prepared for losing ISA status I never factored having to pay this growing long term fund as annual income

Grayling

Unfortunately those are the rules.

This is an area where you really need to take expert advice.

I believe there is a tax free allowance (around $50000) but am not sure what that would apply to. Also once you pass that limit the whole lot is taxed (as I understand it) not just the amount above.
http://www.ato.gov.au/default.asp?menu=298

G

thebears

http://www.ato.gov.au/individuals/co...p=001&st=&cy=1

Grayling

And Here:
http://www.ato.gov.au/individuals/co...tent/57251.htm

This is a minefield.

Get expert advice

G