UK tax while working in Australia for 12-24 months

[Mehmeh]

Hey guys,

Am going to be moving to oz for a year or 2 on the working holiday visa deal.

Plan to do contracting there, but not sure how it effects my UK tax?

So I'll be paying Oz tax on my earnings there right? Can I still use my UK tax allowance (i.e keep paying myself divis from my LTD company)?? Or do I need to declare the Oz earnings to HMRC or the UK earnings to Oz tax man?

Cheers

[BlasterBates]

Fill out this tax form

HM Revenue & Customs: Residence & domicile issues - forms P85 and P85(S)

You will be tax resident in Australia, now you'll probably need to declare you divis there, but if there is a double taxation treaty and they are taxed in the UK, they will take that into account and probably not tax them again. Even if you pay 0 tax because your below the threshold it will still be deemed UK taxable and therefore not taxed again, if so stipulated in the DTA.

Just follow instructions and submit tax returns where you need to, the Double Taxation Treaty will sort everything out.

[JoJoGabor]

As above, but its a nightmare. Particularly as the Oz tax year ends in July and UK ends in April, so ther eis overlap, combine that with trying to determine fair domicile times in each country in each tax year. Neither the Australian or the UK tax authorities could give me a definite answer so I made a best guess on my tax returns

[Mister Clark]

Hey guys,

Am going to be moving to oz for a year or 2 on the working holiday visa deal.

Plan to do contracting there, but not sure how it effects my UK tax?

So I'll be paying Oz tax on my earnings there right? Can I still use my UK tax allowance (i.e keep paying myself divis from my LTD company)?? Or do I need to declare the Oz earnings to HMRC or the UK earnings to Oz tax man?

Cheers

I think your overall plan could be no go mate, you need to do a bit more research.

If you are going to contract in Oz read this first: 80/20 Rule explained | Australia | Contractor Taxation

AFAIK the working holiday visa allows you to work 6 months with one employer then you need to find another gig and it lasts for 12 months max. You also need to be 18-30:

Working Holiday Visa (Subclass 417)

The other option is to get sponsored.

I to will be leaving these shores for Oz so have looked into it.

Oz also has a working away from home allowance, not sure if you are eligable for this if you contract, something to look up as its value is significant.

[Mehmeh]

18-30 yes.

Get a new contract after 6 months... no problemo

Plus you can apply for a second working holiday visa at the end of your second if you can prove that you've been picking fruit or labouring for at least 12 weeks while out there... (my mate runs a building company :-) )

[Mister Clark]

18-30 yes.

Get a new contract after 6 months... no problemo

Plus you can apply for a second working holiday visa at the end of your second if you can prove that you've been picking fruit or labouring for at least 12 weeks while out there... (my mate runs a building company :-) )

Good for you mate, sounds like a go'er.

Be aware your extension is a max of 6 months, just in case you want to stay the full 2 years.

I was over there 12 months ago and will be going back Aug next year, the rates are awesome, the weather is great (depending where you are off course), and the beer is cold - enjoy and good luck.

[Clare@InTouch]

I would suggest you discuss the exact dates with a UK accountant before you go, there could be ways to optimise your UK allowances depending on when in the tax year you leave.

If you're in the UK for 183 days in any tax year then you're resident here, and all your income will be taxed here. You'll usually get credit for tax you pay in Oz, although I don't know how the Oz tax authorities would view it.

[Fred Bloggs]

I would suggest you discuss the exact dates with a UK accountant before you go, there could be ways to optimise your UK allowances depending on when in the tax year you leave.

If you're in the UK for 183 days in any tax year then you're resident here, and all your income will be taxed here. You'll usually get credit for tax you pay in Oz, although I don't know how the Oz tax authorities would view it.

I have recently read the UK/Australia taxation treaty. From what I can see, it seems fairly straight forward, Oz earnings are taxed there, UK earnings are taxed in the UK. I'm sure it can't be that simple, but that's what I think it says. I'm considering a 4 year job in Oz myself on the big gas projects out there hence my interest.