Premium Bonds
 

Hi All
Anyone any ideas on how it stands on having UK premium bonds left in the UK whilst living in Australia? For example are any winnings (as if!) taxable in Australia if that is where you have them sent?

thanks
ian

Re: Premium Bonds
 

In <[email protected]> ian wrote:
    > Hi All Anyone any ideas on how it stands on having UK premium bonds left in the UK
    > whilst living in Australia? For example are any winnings (as if!) taxable in
    > Australia if that is where you have them sent?

I'll be interested to know the definitive answer to that, but I'm pretty sure
the winnings will be classed as taxable income that must be declared in an Aus
tax return.

Re: Premium Bonds
 

Nobody any ideas on this? Surely someone who has emigrated has taken premium bonds with them? Could be an interesting one as winnings here are tax free but I have a feeling would be taxed down under?

Anybody??

Thanks!

ST

we cashed ours in and will put money into summit in Oz

Re: Premium Bonds
 

Yes. I have previously checked this out......

Your winnings ARE taxable in Australia.
eg: you win £1M convert at say 2.5, and get $2,500,000 into OZ.
The Tax man will then take just about $1,212,500 of that in tax !!!
Obviously smaller winnings may not hit the same high tax rate as the big one would.

Option: Put the bonds in the name of someone you trust, that is staying in the UK :)

or
Return to UK if you win the big one !!! (not sure if the ATO would then chase you up for their share, especially if the money never entered Australia) :D

Why are any winnings on Premium Bonds taxable in Oz? Lottery winnings are not taxable and as Premium Bonds are a game of chance I would think they would fall into that category. Interest is taxable but can't see how something so uncertain would be classified as interest.

I agree with your thinking, and parts of the ATO web site actually appear to agree with that: eg: However, I did find something that did specifically include the Premium Bond winnings for Tax purposes. I am trying to locate the page again now ! I wish I had put it on my favourites at the time !! :)

This quote gives an indication though:
Lotteries are gambling - non taxable

Premium Bonds are investments - taxable

http://www.ato.gov.au/individuals/co...tent/32214.htm

Interesting, truthfully it never occurred to me that they would be taxable earnings. Does anyone know if the UK authorities pass the names of winners in Oz to Oz tax authorities? I know when we lived in the US we were unable to hold Premium Bonds because of some agreement between the US-UK so makes me wonder what type of communication goes between the two countries.

Oz tax regulations specify they won't pass any info onto foreign bodies, wonder what Uk rules are?

Personally I would think that I you did have a big win the only way you might get caught would be if you were trying to bring the money into Oz. YOu could slowly but surely suck it out of the hole in the wall and would they know??

And how can they class Premium Bonds as "investments" anyway? You never earn any interest on them, and the chances of a minimum £50 win only really exist once you hold £20,000 or more (which I used to, and pretty much had a £50 win every month, sometimes 2 or 3 wins, but never the big one :( )

Maybe because your money is held with the: - - National Savings & Investments ?

:D

The difference being that with lottery, you lose what you put in, but with ERNIE, you at least get your initial investment back.

That just made me think, any foreign exchange variation will affect your tax return when you cash them in aswell :) oops

I agree :D Now I just want to win the big one, so I can test that theory :D :D

What is Summit? Is this the same sort of scheme as the premium bonds?

Just in case you might be sitting on a small fortune :rolleyes: ha ha if only, you can now type in your premium bonds holder number and it will let you know if you've won anything. Here's the link http://www.nsandi.com/products/pb/ha...eYouWon&view=1

Bet there's loads of you ever hopefuls rummaging through drawers right now! :D

Interestingly I was once told by an financial adviser that a block of premium bonds could be considered a legitimate investment as it has been estimated that if you hold a worthwhile amount (forget the figure) it is estimated that the winnings will return approximately 5% per annum.
This would be very similar to investment in government bonds and some savings schemes.

G

Re: Premium Bonds
 

Well we were told by the embassy in Berlin, that any money we bring in in the first 6 months is not taxable but after that it is, so I guess you just have to pray that your bonds come up in the first 6 months ;)

They actually allocate 2.4% per annum to the prize fund, so it SHOULD average at that. However the larger holders do seem to win more than their share, when compared with small holders.

I had a £1 one for 40 years and a £5 one for 30 years, and won nothing !!
:D