Sooty and Sweep

http://www.commbankuk.co.uk/moving_t...eign_exchange/


Hi,

Has anyone any experiences of this account above. The exchange rate is poor, so an option. I know all about the six month gains taxation rule on forex exchange etc etc, but like i said in a previos post, i would rather pay any tax if it exists, as i have made a profit rather than pay no tax as i would not have made a profit.


Does this account pay interest etc on large sums of say for example £100k to say 500k. Its just if you have say 200k sitting in the account for twelve months, then who gains from interest paid?


Thanks.

leave_n_on_a_Jet

i just had a read of it, seems like the usual australian thing how to make something easy just that bit harder.

Personally i would keep the money in a uk bank, put an auto buy price in with a company like hifx, if the rate hits what you want while fx is open (unlike Commonwealth where they say during their business hours) you will get a call. then transfer the money from you account to theirs, you can normally pop into you own bank and do the whole lot in 1 hit.

my cash has always arrived next bussines day when sent from the uk.


one interesting about commonwealth, i wonder if you finds are covered under the Gov Bank Guarantee? the same as they would be if in australia.

James

Sooty and Sweep

Trouble is, i want to go in October, and with the rate the way it is, there is no way i am changing over my money. I have a ***,000.00 sum to change over, so want the rate i feel is right for me.

2.5 would be good, anything over would be great, otherwise its wait or find an alternative option.

MartinLuther

Whatchoo talkin' about Willis?

leave_n_on_a_Jet

i dont see a prob if you want to go in Oct as you can set a buy price as far ahead as you like, once the price is hit you can normally take delivery up to 12 months ahead, all you have to do is pay 10% deposit then the other 90% just before you want the money / you due date.

if you leave you money in the uk you can transfer it via the internet, check limit on internet transfer, i have 5 accounts to i can pump the money accross quick.

James

Wol

He doesn't know <g>.

Sooty and Sweep

http://britishexpats.com/forum/showthread.php?t=485444

I know, but here a million times?

Sooty and Sweep

What do i not know? Good news or bad?

Sooty and Sweep

The way round it for me maybe is?


Open one of these accounts;

http://www.nationwideinternational.c...ng_tracker.htm

open one of these accounts;

http://www.nationwide.co.uk/current_account/default.htm

Have the money/lump sum paid into the offshore account, then go to Oz.

Have the interest from the offshore account paid into you Flex account monthly.


This will be Gross free of taxation, pay your tax liablities to the ATO as you are now a PR resident in Oz.


When the exchange rate improves, while living in Oz, go on the internet, CHAPS your lump sum from your NW offshore
account into your forex account, then into your Oz account.


So say for example you had 500k sterling. I know lucky you!


500k @ 2.3% per annum monthly interest = £11,500.00 per annum = £958.00 per month

Exchange rate = 2.05 minus 1% Nationwide ATM withdraw fee = 2.03

£11,500.00 muiltiplied by 2.03 = $23,345.00 per annum = $1945.41 per month

Income tax to be paid in Australia = £2602.00 per annum

http://au.pfinance.yahoo.com/calcula...ncome-tax.html

Weekly net income after tax = $399.00 minus maybe $6.00 per week medicare?


So worst case = $393.00 per week.


Best option until the exchange rate improves?

MartinLuther

I love that thread. Nothing funnier than seeing Alan bitch-slapping JAJ.

(I know that JAJ had previously countered my opinion with that one. So it was pleasing to see Alan's take on it.)

The bad news is, that there is no 6 month rule for forex. The 6 month rule is for certain types of pensions only. That's it.

The good news is that if you transfer the money (for exchange) from a UK account opened before 20 Sep 1988 then you're gains aren't taxed.

The bad news is that you have to be old (and kept an account from that time) to benefit from this.

Sooty and Sweep

Thats good news, so are you saying when entering you have no timeline for exchange?

Either exchange on arrival/landing or pay tax on any future gains?


Still if this is so, would rather pay tax on say:

Enter at 2:1 so £500k*2 = $1000000.00

Twelve months later

3:1 so £500k*3 = $1.5 Mil

Tax on $500k@30% = $150K


Still $350k better off?

MartinLuther

Yep, unless you have the pre-88 account (although you could probably get away with it for small amounts).

The other thing is that if you change after 12 months then try and get it done as CGT (by transferring from an account opened before 1 July 2003 - I think). That way the tax is cut in half.

I have the same philosophy as you. I would like to avoid tax but at the end of the day you don't cut off your nose to spite the tax man.

You know it's going to be 2.4 in September.

Sooty and Sweep

The other thing is how will they know, or will they find out? Numerous entry dates?

Nearing a fifteen year low now?

simonking

I think the response from pingpong a few days ago sums up the position:-

"Hi, I was speaking to an accountant mate the other day who also used to work for the ATO. He said that as long as your not a forex trader and classed as running a business then any profit made by transferring funds was pretty much classed as good luck, obviously as long as your not doing it every other week. His example was that if you went to the US for a few months and bought 20k worth of travellers cheques, then the USD rallied and you decided to come back a week later you would have made a handsome profit. Thats good luck. If the reverse happened and you lost, thats bad luck..."

So no tax should be payable for most unless trading.

MartinLuther

I tried to sell that story to the ATO. And they disagreed.