logan

Okey dokey. This may have been covered many, many times but we were still slightly confused and we got an answer to our question and I'll share it with you all!

Question: We have money in British account (from housesale or whatever else)
Do we get taxed when we transfer it to aussie account?
Do we get taxed on it if we transfer it after being in country for 6 months?

Answer: You do not get taxed on it. There is no time limit. It does not matter if it's brought in under the person who's a citizen or the person who's on a PR visa, you're both residents.

It's amazing this whole do your own tax thing! I initially thought it was very confusing, but now I understand it...I think!!

worzel

But I think you have to declare interest on the accounts and get taxed on that. Not the capital, though, as you say.

There is also something in the back of my mind that if you don't transfer it within 6 months then you also get taxed on any exchange gains as income.

logan

I believe that you get taxed in the uk cos it's a uk account, so they don't charge you here also.

I asked about the 6 months and she said no.

worzel

Sorry, I assumed on the first point that you would complete a R105 form to get the interest paid gross in the UK.

I remember Alan Collett posted something about the second point a long time ago. I also recall that it depends on whether the account is newly opened or not. What I don't remember is whether new accounts risk the 6 month thing or old ones. New I think, as I have an inlking I thought I would be safe.

biggy

But if u lose out of the exchange rate you can also claim a tax offset

pandya_m

Wait its not Income Tax. Its a Govt Policy. Its a Economics.
Do you understand Balance of Payment, Fesical Deficit...No.
me too
Well the short version of story is No Govt. (be it a Ausi. Britian. US or India) mind foreign money coming in. Its a welcome move if you bring along with youself.
Like if you immigrate you are allowed that money (that you have already payed IT in your home land) in w/o tax. You are adding money to Govt. Kitty and will put in blah blah bank and bank will use it. Or you will invest it so again thats an investment. So the Game goes in Rotation of Money. Did you hear Japan Burst.. and Brazil gong in Bankrupcy... ok. Long lines at ATM and banks. People pulling funds, Govt. in shortage of funds... ok thats it.
Now look at other way around. You are in Oz. You invest something in your home land as Non Resident, will you taxed. No did you hear yes. No. No only on investment, but if you earn and want to take the earning, since you are a non Resident and you have earned. Pay Tax dear, but yes after paying tax you are welcome to bring in Oz those money (since Govt. treats you as wise investor if you loose your money on investment its your fate )
Did you get it...
Confused..?
Yes thats the nameth Economics

kirsty&al

The answer depends on when you transferred the money.

First of all, the only 6 month rule only applies to pensions.

Secondly, if you transferred the money before you arrived in Oz or on the day you arrived in Oz (to stay permanently - validation visits don't matter), then there are no tax implications in Oz. If you transferred the money after arrival then the following example applies. If you had £100,000 and it was worth $240,000 on the day you arrived, then if it was worth $250,000 on the day you trasferred it, you will be liable for tax on $10,000 at your marginal rate.

If you are talking about interest, then any tax paid in the UK can be offset against your Oz tax bill. You don't pay tax twice, you just pay an amount equal to the higher of the 2 tax bills (either to 1 country or split between them).

I tried the form (R105 - mentioned above) for getting UK interest paid gross but some of the banks wont allow you to do it unless you are resident in the UK. So you can either leave the tax in the UK and pay the difference in Oz or you can claim the UK tax back with a tax return and pay all the tax in Oz.

Regards
Alistair

logan

Ahh now you see, everyone starts using terminology that confuses me! thought this might happen. I only put this on in v. simple terms, literally quoting what our accountant told us. If this confuses others I apologise. If people think I'm posting rubbish, no problem, I'm not claiming it as my own, just what we were told today.
Bottom line, we have not paid tax on any money we've transferred since arriving and we will not when we transfer the remaining, whenever that may be. Gee I need a

pandya_m

Target Achieved

MrsDagboy

But thats what Al is trying to say - if the money is worth more when you transfer it than when you entered the country then you will have to pay tax on the increase. Its a capital gain & you'll be liable for CGT on it.

If your tax advisor tells you otherwise, I'd be getting a new tax advisor .

worzel

Here is the Go Matilda article I referred to (must have read the 6 month thing elsewhere):

http://www.gomatilda.com/news/article.cfm?articleid=327

The techy bit at the top isn't that clear but I think the examples are.

longreach

Correct - if you make any gains on FX after you become a tax resident, then you are liable for tax on any gains you have made.

And for the 1,000,000,000,000 time the six month rule applies to pensions only.

kirsty&al

In addition, if your tax advisor gets it wrong, then the ATO chases you for the unpaid amount plus interest (you might get away with the fine); and they use an interest rate that would make a loan shark blush.

A.

logan

Cheers. Maybe I got the wrong end of stick, but I asked Mr L to look at what I'd typed and he said it was as she explained. Oh well.

ABCDiamond

Absolutely correct, based on JUST the capital figure, it only gets complicated when the interest or the foreign exchange rate gets involved