Aussies Abroad - 5 Things You Need to Know About Taxes When Living Overseas

It’s easy to assume that if you’re living overseas, you don’t have to worry about filing a tax return at home, especially if you’re paying tax on your income in your new country of residence. However, this may not be the case. Even if you’re paying tax on your income in your new country of residence, you may need to report these earnings back home. So, fire up a tax calculator for Australia, and dive into the tips below to ensure you’re meeting your obligations. 

1. You won’t be taxed twice

It’s important to clear this one up right away because it’s generally the thing that stops people from fulfilling their tax obligations at home. If you’re earning an income overseas and being taxed on it, you won’t be taxed again on the same income when you file it in Australia. It’s simply a matter of recording it the right way to ensure your reporting obligations as an Aussie resident are met. 

2. It’s easy to determine your obligations

With that major fear out of the way, let’s move on to exactly how you figure out whether you need to file your taxes. The ATO likes getting tax returns, so they make it super easy for you to figure out what your obligations are, regardless of how complex your circumstances may be. All you need to do is visit the ATO’s website and take the test to determine your residency. This will show you exactly what your tax status is with Australia and reveal what you need to do about tax returns. 

3. Adjust your MyGov account log-in before you leave

If you haven’t left yet, it’s important to set up your MyGov account so that you can access it without having to receive a code to an Australian mobile phone number. Fail to do this before you head overseas, and they will give you no workaround. It’s frustrating, but that’s just how it is at the moment. If you’re already overseas, you’ll likely have to set up a new MyGov account and link the ATO, Medicare, and any other relevant accounts you have. 

4. Consider your super

If you have an Australian super fund and travel overseas, you will still be subject to the same rules regarding when and how you can access your retirement funds. If you have a self-managed super fund (SMSF), it’s important to contact your fund before you go away (or as soon as possible if you’re already overseas) to ensure it will still meet the criteria for tax concessions. If you’re uncertain about this or simply don’t have the time, it may be worth contacting a trusted SMSF accountant to help you out. 

5. You will still be liable for the Medicare levy

Finally, in most circumstances, you will still have to pay the Medicare levy. This is because it is a blanket tax placed on all Australian residents, no matter where they live. The good news about this is that while in Australia, you will still be able to access all medical services covered by Medicare. You can also sleep a little better at night knowing that your taxes are helping support vital health infrastructure.

Keep these essential tips in mind, and you’ll be in a good position to get the most out of your time overseas without setting yourself up for any nasty tax-related surprises when you eventually head home.