gedge

As part of my contract I was entitled to the services of the company tax agent. Great.
I went to see them a few weeks back and took all my paperwork. The guy that done the figures didn't strike me as being particularly switched on.
Firstly when he took in to account my UK income, he took the amount for the full UK tax year starting in April 03, through to when I left in Jan 04.
Secondly he used an exchange rate of $3 to the £1! Oh I wish!

I raised this with him saying it shouldn't be the full amount from my P60, nor should it be times 3 (more like 2.4 when I came over).
So he adjusted the figures and I ended up in a lower tax bracket, so am due a big refund.

Can anyone advise how their UK income was calculated for inclusion on a tax return?

I've looked at the bit about exchange rates on the ato web site and it seems to imply that you should use their quoted rates???

renth

I think it depends on whether the income came over to Australia at regular intervals, in which case you take the rates you got on the day(s).

I'f the income came over in dribs and drabs or not at all the ATO tell you what rate to use.

gedge

No, no. I earnt and spent it all while I was in the UK. The figure is just used to calculate tax bracket, not so the ato can claim tax from it. I believe.

Sandra

Did you come over this year in Jan 04 ? You earn't that money while in the UK before you emigrated? Sorry it is unclear when you where earning this money.
Nothing earned in the UK before you emigrate is taken into account here in Aus in that first year, that is my understanding.

owieb

If you contact the ATO they will give you the average exchange rate to use when calculating foreign income on your tax return.

I did write it down when I contacted them the other day, I can't find it now, but I think it was around 2.398 $ to the £.

Alan Collett

Dear oh dear ... if you want some assistance please send me an email ...

In short, income arising before you became tax resident in Australia isn't assessable in Australia. Thereafter your worldwide income will be.

Did you also claim a tax refund from the UK Inland Revenue when you left?

Best regards.

Alan Collett

That's not correct either ... income earned prior to becoming tax resident in Australia isn't "exempt foreign income"; if a taxpayer has such income it isn't assessable in Australia but affects the rate of tax on income on which one does pay tax to the ATO.

Best regards.