Taxation in Aus for Bringing Money Across

[Geelslang]

Hello all. I have been in Aus almost 2 years now. June will be 2 years on a PR visa. I cashed out my pension and brought that over. No problem. Paid my tax in SA and paid into my AUS bank (what was left anyway after the Zuma conversion rate). 

 

Question is, at what point will I be taxed in Australia by ATO? Is there a concessionary amount one can bring over when emigrating and for how long will that apply?

 

Thanks all. Not talking huge money here by the way, maybe $ 40 K (over and above what I brought previously).

[BobSA]

Since the amount has already been taxed I do not think it would need be taxed again as that would amount to double taxation!

 

You have the proof of tax has paid already should any queries arise!

 

Link attached if you would like to read boring tax agreements 

 

http://www.austlii.edu.au/au/other/dfat/treaties/1999/34.html

[greggle]

I'm not sure that @bobsa is correct. My partner is an Australian (and South African) Tax Lawyer / Academic ... and has just been tasked with investigating and calculating how my SA retirement funds have to be treated in Australia, given that I have just completed my financial emigration. 

 

In short, its complicated (at least, for a non-tax mortal such as I) ... terms like "applicable fund earnings (‘AFE’)", "concessional" vs "non-consessional", all get me scratching my head. But is seems that it depends on whether you transferred the money within 6 months of becoming resident or not, if you transferred the money directly from your fund in South Africa to your Super fund in Australia, as opposed to cashing it out and doing an FX to your Aus Bank account, etc.etc.

 

This may help: https://www.ato.gov.au/individuals/super/in-detail/withdrawing-and-paying-tax/tax-treatment-of-transfers-from-foreign-super-funds/

[BobSA]

@greggle Interesting point.

 

But given that @Geelslang has already cashed it out in SA and paid tax and is not looking to transfer it into a super -fund in Australia the amount would be treated no different to transferring normal SA savings as I would understand it? Your link is applicable if you bringing the funds across after financial emigration and you don't get taxed in SA as you transfer the full Gross amount across to a Super-fund. Also the impact of financial emigration possibly changes things?

 

But I would certainly defer to the experts in this case as I am certainly a newbie on Australian Tax law. I would however be rather upset if I cashed out my Pension/Provident in SA, paid the tax in SA and then still got hit with further taxes in Australia. Seems excessive!

 

 

[greggle]

 

50 minutes ago, BobSA said:

@greggle Interesting point.

 

But given that @Geelslang has already cashed it out in SA and paid tax and is not looking to transfer it into a super -fund in Australia the amount would be treated no different to transferring normal SA savings as I would understand it? Your link is applicable if you bringing the funds across after financial emigration and you don't get taxed in SA as you transfer the full Gross amount across to a Super-fund. Also the impact of financial emigration possibly changes things?

 

 

 

True, I did assume (incorrectly) that @Geelslangwas going to put those funds into his Super fund.

 

In my scenario, I did have to have my RA & Preservation fund withdrawal applications submitted to SARS who deducted their big chunk ... and I was paid out the remainder which I then converted to AUD. I am not aware that South Africans are able to simply transfer their retirement funds directly to an Australian Super? I was guided by FX Capital on this so did not ask that question.

 

But look at the left-hand tab on the link I sent "transferring amounts to yourself" ... which is the category that I now fall into given that this money is going into my new Super fund (https://www.ato.gov.au/individuals/super/in-detail/withdrawing-and-paying-tax/tax-treatment-of-transfers-from-foreign-super-funds/?page=5#Transferring_amounts_to_yourself).

 

I'd imagine that Geelslang may have to declare gains made for the period that he was resident in Australia and the money was invested in SA (with a rebate for the SA tax) ... but yeah, I'd defer to an expert. (PS My partner is not currently registered to offer advice so won't unfortunately be able to assist).

[Tiermelk]

You wont pay any tax on the lump sum you brought over. You will however pay your standard tax rate on any income generated (interest earned) by those funds in Australia. 

 

[Geelslang]

Thanks for all the great responses and debate. Not sure I am 100% clear, but have enough to go on now. Thanks all.