Australia - Stuck and Need Some Advice

[velcro]

I've got a pot over there, long term UK citizen and tax resident but an Oz citizen. I've just done a re-google and pretty sure I can take it as a tax free lump sum at 60 at the Oz end, and that I don't have to put that on my UK self assessment due to the double taxation agreement. Anything wrong with that belief !?!?

I'm in the same boat: dual national with Super still in Aus. I'm thinking that would be OK, but to be honest I hadn't thought all that hard about it before, as it's still a way off and things are liable to change. I'd also believed I'd be living back in Aus by now anyway so it wouldn't matter, but life takes funny turns...


To the OP: Would you and your partner be able to live and work in NZ, and then while there apply for a spouse visa back in Aus? Just a thought.

[velcro]

Try the britishexpats.com forum for advice. They're pretty helpful

[rootsnall]

If you are making that as an assumption, I think you ought to recheck your assumption. Admittedly, it is not a simple area but I do know that entitlement to DASP is time limited. It may also depend what type of visa you are or were out there with. My understanding isn't necessarily 100 per cent complete since I retired before leaving Oz so my super fund benefits were taken in full before I left there. I do recommend you look at this to be sure. Unfortunately, if you have returned to the UK and then claim your super fund benefit you have to declare any overseas pension lump sums on your self assessment. I think that rule came in four or five years ago to close loop holes on tax free lump sums from overseas pension plans. As usual, they were being abused by the tax "planners" but it's the honest guy who gets caught in the cross fire. Sorry I can't be more helpful but I do recommend you check this out for your own peace of mind.

Edit - I just spotted that you are an Australian citizen in the UK. None of what I wrote likely applies anyway.

I'm a dual citizen. It's 5 years away yet and I'd do a thorough check at the time. I'm stuck with rip off BT Super as I can't change without a current Oz address when I last tried. It's not a huge sum but enough to plan ahead.

[rootsnall]

I'm in the same boat: dual national with Super still in Aus. I'm thinking that would be OK, but to be honest I hadn't thought all that hard about it before, as it's still a way off and things are liable to change. I'd also believed I'd be living back in Aus by now anyway so it wouldn't matter, but life takes funny turns...

A few years off for me also. Pretty certain the Oz end is tax fee at 60, it's just if you have to declare it on your SA in the UK. I'll ring HMRC when the time comes.

Australian Lump Sum - Community Forum - GOV.UK

7 key things to know about accessing your Australian superannuation in the UK | bdhSterling UK

[Fred Bloggs]

I'm a dual citizen. It's 5 years away yet and I'd do a thorough check at the time. I'm stuck with rip off BT Super as I can't change without a current Oz address when I last tried. It's not a huge sum but enough to plan ahead.

Thanks for confirming. None of what I said applies to you then. It (DASP) applies to non Oz nationals working in Oz on a visa, like I was. Cheers.

[oilboil]

I've got a pot over there, long term UK citizen and tax resident but an Oz citizen. I've just done a re-google and pretty sure I can take it as a tax free lump sum at 60 at the Oz end, and that I don't have to put that on my UK self assessment due to the double taxation agreement. Anything wrong with that belief !?!?

I'm the opposite. A UK citizen, but have previously resided (as PR) in AUS and will be going back very soon (as PR still - and citizen eventually)

Now if I take (in 20+ years) my lump sum from the UK pension it is untaxed in the UK, but the lump sum is taxed as worldwide income in AUS at my prevailing income tax rate on the year it is withdrawn. Id' be shocked if the opposite wasn't also true and whilst you could withdrawn the lump sum in Oz, you would have to declare it as worldwide income to the UK.

The double taxation treaty only means you don't get taxed twice (so if AUS tax is 30% and UK tax is 40% and you have already paid 30% in AUS the UK will just ask for the 10%). In this case you've had an income of your AUS pension lump sum - you've paid 0% tax on it, so the UK applies the double taxation treaty and determines you owe it 40% tax

There are other rules and dispensations if the money remains in AUS and is not brought into the UK. Specialist advice is needed...

[rootsnall]

There are other rules and dispensations if the money remains in AUS and is not brought into the UK. Specialist advice is needed...

I'm guessing the logic is you got taxed on the Aus pension pot when you paid it in ( 19% comes to mind but it was years ago ), so the opposite of the UK system. So taxing it on the way out at the UK end is double taxation. I think a telephone call to HMRC ( and Oz tax end ) will answer the question. You've already said similar above, UK Capital Gains tax as a basic rate tax payer I'm guessing is lower than the tax paid on contributions at the Oz end, UK CGT is only 20% at the higher rate.