kendalanita

I know you lot are a lot brighter than me - so here goes!
The plan is - (in my dream world) - fingers crossed!

Sell uk house
Transfer lump sum over while exchange rates still pretty good
Put in high interest accounts (been advised not to put it all in one bank)
Take interest monthly and use it towards rental until we decide to buy

Is this good idea or not? Also what about tax?

Any advice or info greatly appreciated!!!!

Thanks guys

TiddlyPom

I think it sounds fine as a plan...

First sell your UK house... therein lies the challenge from what I hear!

asprilla

Can I ask, are both you and your partner working? If the answer is yes, then I think your plan is a good one.

If the answer is no, then a better plan might be to get both of you out in the workplace, and use that extra income to pay the rent. This will mean you end up with a far bigger lump sum when you decide to buy a place.

Living off the interest sounds good in the short term, but it isn't sustainable.

Either way, when you do your tax return you will have to pay tax on all the interest you earned over the year, so that is something to remember.

moneypenny20

I guess it depends on how big the lump sum is. Interest on $20,000 is going to get you sod all. Interest on $1mill will get you slightly more

newjersey

You have just crushed my dream Seriously though, nowadays a high interest account is safest way to go.

NJ

comet555

Sounds like a good plan to me, we did the same thing when we moved over.

If one of you is not working then it's best if you're savings account is in their name only. That way the interst earned counts as their "earnings" and doesn't get counted on the one who is working already. If you have it as a joint account then the interest is earned jointly, which is fine if you're both working.

Burbage

Yes they tax you interest on your hard earned savings which they've already taxed you on, and yet when you buy an investment property you get tax breaks on the interest you pay for adding to the world credit failure.

They're crazy mixed-up kids, the Aussies.

Kooky.

You're going to go down very well on BE, Burb

Very topical, kendalanita - The Geek and I went to see a Financial Advisor just this morning.

We've been here six months now, and have UK offshore savings and a total of 4 pensions that have been frozen since we left the UK in 2002. We've also got some money in Singapore in their equivalent of Super, and it's all getting a bit confusing.

In the hope that we're going to put down roots here in Oz, we've been advised to bite the bullet and get it all over here. It's about A$200k in total so we'll stick some in a savings account and probably gamble the rest, although being an accountant I'm not good at risk. We're also weighing up staying as Temp Residents for the LAFHA and going for PR for the FTB grant and a bit of security.

It's a very bad time to make any decisions on investments - anybody got a crystal ball?

Burbage

At least the no-good Jungle bum isn't here to tell me off!

Why not buy a property? By the time you get residency the first home buyers allowance will be back to 7K anyway, and you'd waste that much on rent anyway by waiting.

Kooky.

I've been told that we lose the LAFHA as soon as we apply for PR, and at the moment it's paying the rent, but it's definitely something we need to consider.

(The Geek currently gets about a third of his salary tax free, thanks to LAFHA.)

walaj

if one is not working & you have children, then FTB part B will easily be reduced, maybe to zero. thus weigh up if joint or individual account will best over all for you (remember the ATO has access to Oz bank info on interest, so there is no hiding it - not that you would! )

comet555

True enough, although by the looks of it you could still earn up to $4526 with no effect on the benefit. You can also earn up to $17,000 a year in interest (or other sources) as a stay at home mom and still collect FTB part B although at a reduced amount.

http://www.centrelink.gov.au/interne.../ftb_b_iat.htm

It would have to be weighed up on an individual basis though. When we did it we knew that we were going to buy a house in 3-4 months so even with a fair bit of interest it didn't matter over such a short term.

Thanks for mentioning it though, hadn't even thought of it. Also, in checking the link I discovered that we won't get FTB part B anymore even with me not working because they've now added the income test. Not complaining though, I didn't really think we should be getting anything in the first place!

kendalanita

Thanks comet555 - that is brilliant advice, I would have never thought of putting it in the one name only for tax purposes - you have probably saved us a fortune! I'd buy you a drink if you weren't so far away! Cheers

Kooky.

Our savings are in my name (as it was technically my house we sold) and I'm not currently working but we're taxed as a couple; my husband had to declare them on the tax return. Not sure if that's specific to Temp visa holders.

kendalanita

We're on PR visas, haven't got a clue if that makes a difference or not - how hard is all this? Not settled enough to buy yet so was just trying to come up with a way to help us out with the rent - damned expensive!