SoCalDon

Since the GBP has been so weak for so long, I have a UK pension paid into my UK bank account and I am leaving it there until the Pound gets its act together. At some stage though I'm going to want to transfer a wad of cash to Australia. I have always imagined that the ATO would notice and tax it.

I have asked a few tax professionals and have always received wishy washy answers. So, yesterday, I went straight to the horses mouth and phoned the ATO! Here is the official answer:

If you move a lump sum of any size on a one-off basis from the UK to Australia there are no tax implications whatsoever and the ATO will not try to take a piece of it. However... If you move smaller amounts on a regular basis it may come to notice as a possible foreign income which will the ATO might ask questions about.

I'm glad I called now - it's only been worrying me for ten years!

Pulaski

Unless a pension is a "government pension" (civil service, military, etc., for which different rules often apply), it is likely that you should have been paying tax on the income in Australia irrespective of where the bank account is located that the pension income is credited to.

It is quite routine for pension administrators, whether company pensions or private pensions, to be notified that the payee is resident outside the UK and pay the pension gross, so the payee can pay the required taxes where they live. Again, that is irrespective of whether the pension payments are credited in the UK, in the country where the payee lives, or potentially a third country.

Lucas_Dad

This is useful info, thanks.

SoCalDon

Thanks Pulaski, thankfully mine's a civil service one and is not taxable according to the ATO

Pulaski

I'm glad to hear that. .... But I am also glad I pointed out the matter of paying taxes in the right jurisdiction for anyone else reading this thread.

Tom Sawyer

I moved a fair bit of money over the past few years through inheritance. Never been taxed on any of it as inheritances aren't taxable here. I do keep an eye on things as you are meant to declare overseas earnings as part of your tax return, and I'll start getting my RAF pension in a couple of years, so need to keep these things in mind.

As for the exchange rate, it is pretty much on the 10 and 5 year averages at the moment, and above the shorter term averages. I moved a chunk last week at $1.83 to the GBP and that has taken nearly a year to get to that point. In the meantime the money could have been in my savings here earning interest, but hey ho, swings and roundabouts. Suggest using the XE app which is real time and has charts showing the movements over a period of time. I also use them to carry out the transfer. Last weeks transfer was done in 24 hours with no problems.

SoCalDon

Thank you Tom. I just downloaded XE and it looks good. I appreciate your recommendation.

rammygirl

Really? You don’t have to pay tax on a Civil service pension?
I pay tax to the ATO on my UK local government pension but not to HMRC (after filling in a few forms to stop tax being deducted at source)