Dinky

Like many I am in the ‘slow’ process of selling a house in the UK. This has been rented out ever since we moved to Oz, with the rent just covering the mortgage – nice! Having recently got PR status and being happy with life here it’s time to cut the ties to the UK. When I finally do sell in the UK I’ll be in the fortunate position of bringing over a sizable sum of money which will act as a deposit on a new place in Sydney. My question is having been in Australia for almost 2 years will bringing over money attract any interest from the Australia Government – i.e. money laundering etc? How have others coped who have been in this position? Where can I go for further information?

Cheers,

D

joho

Not 100%, but I have read that if the house you sale in England is your only owned house, you don't have any tax implications. Would be interested to know this as we still have our property in uK and renting it out with a view to selling next year.

Jo

Dinky

Yep, I understand the UK implications well and am happy that I have no income tax or CGT liability there. I'm looking for clarity from an Australian perspective.

the plumber

From what i can remember you have 12mths from date of entry to oz after that you pay tax on monies brought over.....why not check out old posts , sure this subjects been covered numerous times.....


all the best plum...

PS may be wrong....

JAJ

This is not correct. There is no capital transfer tax.

There may be capital gains or income tax implications for having overseas investments, and there may be issues on pensions, but the idea that there is some tax on capital movements into and out of Australia is totally false. And yet it seems to be widely believed.




Jeremy

ABCDiamond

I feel that normally, the situation will come down to;
the value of your asset when you became tax resident in Australia (in A$ at that date), compared to the final value when you bring it over.
If you have gained during that time, then the gain can be taxed.

I am not sure what effect being a previous Temp visa holder will have on that though.

Money laundering only comes into it, if you try to hide it from the Australian system, and they then get suspicious

Kiwipaul

If you have actually lived in the house in the UK, and not bought a house in Oz yet you can claim your UK house as your Principle Place of Residence (PPOR) for up to 6 years (from the time you moved out) even if you have rented it during this time. This means that any increase in value of the house is free of any Oz CGT.

Assumeing your expenses (mortagage, rates, etc) is more than you income (rent) their will be no income tax liabilities. You just need to declare your gross rent on your sup tax return but it dosn't involve any extra Oz tax liabilities.

shecha

Hi Jeremy,

I am one of those who believed that there were tax implications on monies brought into Australia from the UK after 6 months for persons with perm visas. And I also believed that Australian Citizens were not given the 6 months timelimit to bring monies into Aus without there being tax implications.

Can you clarify this a bit more for me please.

Am I right in now assuming then, that monies from savings alone will not be subject to taxation or capital gains, but that monies from a sale of a property (that was not an investment property and was sold prior to emigrating to Aus) and pensions could be??? And are there differences on tax implications if you are on a perm visa or an Australian Citizen who has moved from the UK??

Or am I totally confused and have no idea what I am talking about???

Cheers Jeremy

Shell

Kiwipaul

This 6 months time limit ONLY applies to transferring pensions to Oz before they become liable for tax in Oz. All other investments need to be valued in Oz $ on the date you became tax resident and then any gain or loss worked out when the money arrives in Oz (might be more or less depending on which way exchange rate goes and wether investment goes up or down)
Tax office treats PR's and returning Australians the same providing they have been tax resident somewhere else for 10 years or more.

shecha

Hi Kiwipaul,

Cheers for that, I obviously did have no idea what I was talking about lol!!!

Its good to know that it is only pensions that are subject to the 6 month rule.
We are leaving our UK Occ Pensions in the UK anyway, so I'm really only worried about our savings (part of which are from the sale of our home) which we want to leave in the UK until the exchange rate becomes more favourable!

Now we can leave them there without worrying about the 6 month thingy.

Cool

You have made my day!!!!

Cheers again!!

Shell

Dinky

Thanks for that it's starting to get clearer! Given the dire state of the UK market, if we buy in Oz before the UK house sale goes through would I only be liable for Oz CGT for the period when the UK house was not my PPOR?
Cheers,
D

Kiwipaul

Basically Yes
BUT You can decide (I believe) to keep your UK house as your PPOR (for up to 6 years) but you would be liable for CGT on your Oz house until you declare that to be your PPOR. You might also not be eligible for the first home owners grant if you kept your UK house as your PPOR (although I don't remember any question regarding this on the application). See if someone else can clarify it futher or just claim your OZ house as PPOR when you buy.

zerocash

Are you subject to tax as soon as you arrive or only after you get your
TFN, and if you dont get a TFN for six or more months would you be able to take advantage of not paying any gains in exchange rates ect?

spalen

TFN allows you to pay the 'right' tax - without a TFN any 'income' (interest, salary, etc ) in Aus is subject to a 'withholding' tax which is the highest marginal rate (48% or thereabouts)

You are tax resident from day you arrive if you want to be.

zerocash

Thanks i understand better now