When you first become an Australian expat there are many goals that you want to achieve whilst you are overseas.
Whether those goals are lifestyle, career or financially driven it is important that you not only outline what you want to achieve from an overseas posting but have something to show for your time away when you are returning to Australia.
After enjoying the lifestyle as an Australian expat and you are returning to Australia, there are quite a number of financial considerations that need to be addressed well before you pack your bags and get on the plane.
As part of our Repatriation Review service we outline the key areas that need to be addressed as well as advising on how to ensure that your repatriation is a successful process.
This review may include but is not limited to the following areas:
Retirement Savings & Pensions
If you have been working overseas for some time there is a chance you may have accumulated some retirement savings in a product equivalent to the superannuation system that is in Australia. Due to the different rules and regulations, as well as costs, it may or may not be beneficial to transfer this to Australia and amalgamate it with your existing superannuation account. There are also a number of key considerations that need to be taken into account when looking to move a foreign pension to an Australian Superannuation account. One of the main considerations is the time frame. As stipulated by the Australian Taxation Office (ATO) if you transferring an overseas pension, like a UK pension for example, to an Australian compliant super fund, and that transfer was to occur within 6 months of becoming a resident of Australia, or within 6 months of terminating your foreign employment, then no tax is payable on your transferred super benefits in Australia.
Whilst overseas you may accumulate a wide array of investments which could include listed shares, managed funds, offshore bonds and properties. When deciding whether to keep these investments you have to consider your investment objectives, ability to maintain and manage these investments, and outside influences which could turn your retirement nest egg into a poor performing asset. Some of these influences could include currency changes, local economic stability and the Australian Taxation Office changing the tax regulations surrounding the tax treatment of that investment. As an example, if you were working in a low or no tax environment then the investment you selected may have been generating an appealing return but when returning to Australia, and you start paying tax on that investment, you may find that it isn’t generating a sufficient after tax return to warrant the risk. We often find that exchange rate volatility can adversely affect returns reducing the appeal of an offshore investment.
Most Australian expats collect bank accounts like kids used to collect baseball cards but when it comes time to move, what accounts should you keep and what accounts should you close down? What is the most cost effective strategy in transferring your assets, including cash, when you are returning to Australia? There are several different options available to you all depending on the type of asset. If it is a foreign pension then you maybe able to transfer that directly to Australia or there maybe more stringent requirements like the UK Pension schemes. If you are transferring cash back to Australia where possible use a dedicated foreign exchange service rather than a bank. The banks charge an extortionate amount to transfer funds back to Australia. Atlas Wealth Management can assist in arranging this for you.
Non-Resident Tax Status
Have you made the most of your non-resident tax status before you consider returning to Australia? Did you acquire shares, managed funds, exchange traded funds (ETF’s) or properties in Australia whilst you lived overseas? The tax treatment of these and other assets change when you set foot back on Australian shores as a Australian resident and what your next step is will depend on how you are holding those assets and what your goals and objectives are. Obtaining the right financial advice can help you make a smooth transition back into the Australian financial way of life.
General Advice Disclaimer
The information provided on this website has been provided as general advice only. We have not considered your financial circumstances, needs or objectives and you should seek the assistance of your Atlas Wealth Management Authorised Representative before you make any decision regarding any products mentioned in this communication. Whilst all care has been taken in the preparation of this material, no warranty is given in respect of the information provided and accordingly neither Atlas Wealth Management nor its related entities, employees or agents shall be liable on any ground whatsoever with respect to decisions or actions taken as a result of you acting upon such information.