Advice on company pension, taxation, medicare etc
Sep 11th 2003, 10:43 am
#1
Guest
Posts: n/a
Advice on company pension, taxation, medicare etc
Apologies if this post is too long but the issues are quite complex! I won't repeat all my details - they are available on a thread of a few weeks ago 'Advice on Spouse Visa'. In summary I was born in Australia and hold Oz and British passports. My wife holds a British passport only and she will be applying for a spouse visa. We married in Oz in 1973 and lived there until 1980 when we emigrated to Scotland (just to reverse the normal trend!). We intend to move back to Oz in the near future.
We are both schoolteachers and will be eligible to draw indexed-linked final salary pensions and lump sums soon (actuarially reduced for early withdrawal). We also took out FSAVC's to supplement the 'company' scheme but have stopped contributing to these when they started performing poorly. We own a property in Melbourne and have bank accounts in Oz. We transfer money to the accounts via the Commonwealth Bank in London (thoroughly recommended service).
I would appreciate advice on the following:-
1 OCCUPATIONAL PENSION. What is the easiest and most tax efficient way of having our occupational pensions paid to us in Oz? We realise we will have to accept whatever exchange rate fluctuations eventuate (don't want to go into forward contracts, hedging etc) but is it just a case of setting up some facility to have them paid in £'s by the Scotttish Teachers Superannuation Scheme to the Commonwealth Bank in London, converted into A$'s and transferred to our bank account in Oz? Will our pensions be taxed in the UK and/or Oz? I know our lump sums are not taxable in the UK so we'll draw them in £'s and have them transferred via C'W Bank in London.
2 FREE STANDING AVC'S. I know we can't withdraw these in cash here and that we can have the funds transferred to another provider in Oz and drawn after we start drawing on our occupational pensions. What is the best way to arrange the transfer - leave it to our current fund manager (Royal Scottish) or seek another party to do it?
3 TAX FILE NUMBER (TFN). We currently pay non-resident witholding tax on the (meagre!) interest on our savings in Oz but when we move we will have to apply for a TFN won't we? Will it be separate TFN's for us or just one for me? I am not sure whether I will be seeking employment, my wife definitely won't. All property and bank accounts are in joint names.
4 MEDICARE/PRIVATE HEALTH INSURANCE. What is the position with respect to this? Will we have to pay the Medicare levy upon taking up residence and/or take out (extra) private cover.
I have already checked out the position with the British and Australian Aged Pensions but as both of these are a long way off I don't have to worry about them now!
ADVICE ON ANY OF THESE 4 ISSUES WOULD BE GRATEFULLY ACCEPTED
TennisOz
We are both schoolteachers and will be eligible to draw indexed-linked final salary pensions and lump sums soon (actuarially reduced for early withdrawal). We also took out FSAVC's to supplement the 'company' scheme but have stopped contributing to these when they started performing poorly. We own a property in Melbourne and have bank accounts in Oz. We transfer money to the accounts via the Commonwealth Bank in London (thoroughly recommended service).
I would appreciate advice on the following:-
1 OCCUPATIONAL PENSION. What is the easiest and most tax efficient way of having our occupational pensions paid to us in Oz? We realise we will have to accept whatever exchange rate fluctuations eventuate (don't want to go into forward contracts, hedging etc) but is it just a case of setting up some facility to have them paid in £'s by the Scotttish Teachers Superannuation Scheme to the Commonwealth Bank in London, converted into A$'s and transferred to our bank account in Oz? Will our pensions be taxed in the UK and/or Oz? I know our lump sums are not taxable in the UK so we'll draw them in £'s and have them transferred via C'W Bank in London.
2 FREE STANDING AVC'S. I know we can't withdraw these in cash here and that we can have the funds transferred to another provider in Oz and drawn after we start drawing on our occupational pensions. What is the best way to arrange the transfer - leave it to our current fund manager (Royal Scottish) or seek another party to do it?
3 TAX FILE NUMBER (TFN). We currently pay non-resident witholding tax on the (meagre!) interest on our savings in Oz but when we move we will have to apply for a TFN won't we? Will it be separate TFN's for us or just one for me? I am not sure whether I will be seeking employment, my wife definitely won't. All property and bank accounts are in joint names.
4 MEDICARE/PRIVATE HEALTH INSURANCE. What is the position with respect to this? Will we have to pay the Medicare levy upon taking up residence and/or take out (extra) private cover.
I have already checked out the position with the British and Australian Aged Pensions but as both of these are a long way off I don't have to worry about them now!
ADVICE ON ANY OF THESE 4 ISSUES WOULD BE GRATEFULLY ACCEPTED
TennisOz
Sep 13th 2003, 11:34 pm
#2
Guest
Posts: n/a
Re: Advice on company pension, taxation, medicare etc
>On Thu, 11 Sep 2003 10:43:00 +0000, tennisoz <[email protected]> wrote:
>Apologies if this post is too long but the issues are quite complex!
>I won't repeat all my details - they are available on a thread of a
>few weeks ago 'Advice on Spouse Visa'. In summary I was born in
>Australia and hold Oz and British passports. My wife holds a British
>passport only and she will be applying for a spouse visa. We married
>in Oz in 1973 and lived there until 1980 when we emigrated to Scotland
>(just to reverse the normal trend!). We intend to move back to Oz in
>the near future.
I may be asking a silly question here, but is your wife sure she is
not an Australian citizen? If she lived in Australia before 1973
(with parents who naturalised as Australians, for example, she could
have Australian citizenship already).
If not, then applying for a spouse visa is going to be the way to go -
even if she was accompanying an Australian citizen, getting a resident
return visa after 23 years would be very hard. Unless she had an old
style Authority to Return or Return Endorsement and kept it valid by
visiting Australia every three years.
>I would appreciate advice on the following:-
>1 OCCUPATIONAL PENSION. What is the easiest and most tax efficient way
>of having our occupational pensions paid to us in Oz?
Tax issues are an area for professional rather than newsgroup advice.
Usually when you are Australian resident, you are liable to Aus tax on
your worldwide income, whether brought to Australia or not. The UK
may tax you on UK source income, but any UK tax should be offsettable
against Aus tax. The details may depend on the double tax agreement -
an area where professional advice is needed.
In terms of administration, I'd say the usual way is to have them paid
into a UK bank account and do transfers through the system to
Australia.
>3 TAX FILE NUMBER (TFN). We currently pay non-resident witholding
>tax on the (meagre!) interest on our savings in Oz but when we move we
>will have to apply for a TFN won't we? Will it be separate TFN's for
>us or just one for me? I am not sure whether I will be seeking
>employment, my wife definitely won't. All property and bank accounts
>are in joint names.
I would think both of you will need TFNs. Did you have tax numbers
from when you previously lived in Australia?
>4 MEDICARE/PRIVATE HEALTH INSURANCE. What is the position with respect
>to this? Will we have to pay the Medicare levy upon taking up residence
>and/or take out (extra) private cover.
You'll have to pay the standard Medicare levy as you'll both be
Medicare eligible. There is a 1% Medicare levy surcharge that applies
to people with incomes over a certain amount who do not have private
health insurance.
Australians are supposed to take out health insurance by age 30, and
are penalised in terms of rates if they do not (I think it's called
Lifetime Health Cover - check the HIC website or some of the health
fund sites). I don't know what the deal is for returning Australian
citizens who obviously won't have had the opportunity to take out this
cover.
>I have already checked out the position with the British and Australian
>Aged Pensions but as both of these are a long way off I don't have to
>worry about them now!
I presume you're aware that the UK-Australia Social Security Agreement
was terminated in March 2001. This does not affect tax issues,
however.
Jeremy
This is not intended to be legal advice in any jurisdiction
>Apologies if this post is too long but the issues are quite complex!
>I won't repeat all my details - they are available on a thread of a
>few weeks ago 'Advice on Spouse Visa'. In summary I was born in
>Australia and hold Oz and British passports. My wife holds a British
>passport only and she will be applying for a spouse visa. We married
>in Oz in 1973 and lived there until 1980 when we emigrated to Scotland
>(just to reverse the normal trend!). We intend to move back to Oz in
>the near future.
I may be asking a silly question here, but is your wife sure she is
not an Australian citizen? If she lived in Australia before 1973
(with parents who naturalised as Australians, for example, she could
have Australian citizenship already).
If not, then applying for a spouse visa is going to be the way to go -
even if she was accompanying an Australian citizen, getting a resident
return visa after 23 years would be very hard. Unless she had an old
style Authority to Return or Return Endorsement and kept it valid by
visiting Australia every three years.
>I would appreciate advice on the following:-
>1 OCCUPATIONAL PENSION. What is the easiest and most tax efficient way
>of having our occupational pensions paid to us in Oz?
Tax issues are an area for professional rather than newsgroup advice.
Usually when you are Australian resident, you are liable to Aus tax on
your worldwide income, whether brought to Australia or not. The UK
may tax you on UK source income, but any UK tax should be offsettable
against Aus tax. The details may depend on the double tax agreement -
an area where professional advice is needed.
In terms of administration, I'd say the usual way is to have them paid
into a UK bank account and do transfers through the system to
Australia.
>3 TAX FILE NUMBER (TFN). We currently pay non-resident witholding
>tax on the (meagre!) interest on our savings in Oz but when we move we
>will have to apply for a TFN won't we? Will it be separate TFN's for
>us or just one for me? I am not sure whether I will be seeking
>employment, my wife definitely won't. All property and bank accounts
>are in joint names.
I would think both of you will need TFNs. Did you have tax numbers
from when you previously lived in Australia?
>4 MEDICARE/PRIVATE HEALTH INSURANCE. What is the position with respect
>to this? Will we have to pay the Medicare levy upon taking up residence
>and/or take out (extra) private cover.
You'll have to pay the standard Medicare levy as you'll both be
Medicare eligible. There is a 1% Medicare levy surcharge that applies
to people with incomes over a certain amount who do not have private
health insurance.
Australians are supposed to take out health insurance by age 30, and
are penalised in terms of rates if they do not (I think it's called
Lifetime Health Cover - check the HIC website or some of the health
fund sites). I don't know what the deal is for returning Australian
citizens who obviously won't have had the opportunity to take out this
cover.
>I have already checked out the position with the British and Australian
>Aged Pensions but as both of these are a long way off I don't have to
>worry about them now!
I presume you're aware that the UK-Australia Social Security Agreement
was terminated in March 2001. This does not affect tax issues,
however.
Jeremy
This is not intended to be legal advice in any jurisdiction
