You’ve decided to pack your bags and relocate you and your family to Singapore. With an abundance of great food and dining options and travel opportunities in every direction ranging from tropical islands to bustling cities, there is very little (if anything) to complain about living in this great city. In addition to this and much more, one of the key aspects that makes it so difficult for many Australian expats to leave is the tax savings.
Let’s look at just how much of a difference these tax savings make. If we assume that you are earning $200,000 per year. As an Australian tax-resident, this would result in a net income of just $132,000. As a tax resident of Singapore, your net income would be approximately $180,000. That is a staggering $48,000 per year, or $4,000 per month, which would be enough to cover the monthly rent for some expats, just to put this in perspective.
With a lack of clear information with regard to Australian tax-residency, many Australian expats new to Singapore make the mistake of assuming that as soon as they’re no longer working in Australia, they automatically cease being a tax resident. This is not the case.
Our team at Australian Expatriate Group have highlighted some of the top tips to support the case that you are a non-resident for Australian tax purposes.
You may also like to consider taking the ATO’s tax residency test to determine if you are an Australian Tax Resident, which you can do here – https://www.ato.gov.au/Individuals/International-tax-for-individuals/Work-out-your-tax-residency/Residency-tests/
1. Driver’s License
Consider changing your Australian driver’s license to an International License. Singapore will typically allow foreigners to drive on an International License for 12 months since relocating. Find out more at the Automotive Association of Singapore – http://www.aas.com.sg/
2. Immigration Card
Now that you are no longer residing in Australia, it’s important that you fill in your immigration card correctly when entering and exiting Australia. You need to highlight that you are a ‘Temporary Visitor’ and that your country of residence is Singapore.
3. Health Insurance
It is worthwhile suspending or cancelling your domestic (Australian) international health insurance and taking out cover in your country of residence, Singapore.
4. Update Your Address with Share Registries
If you hold shares in Australia, it’s important that you update your residential address with the relevant share registries.
5. Updating your Mailing Address with Key Providers
It’s important that you update key Australian providers with your new overseas residential address.
6. Cancel Australian Memberships
As a non-resident of Australia, it could be difficult to justify why you’ve kept your West Coast Eagles membership (for example). It would be wise to cancel these and take out new sporting memberships overseas.
7. Sell / Lease Your Australian Property
For many expats, when leaving Australia, they will rent out their Australian property. This highlights that you don’t have an intention of returning in the short-term and it is simply an investment asset.
8. Advise Australian Banks of Change of Address
It is a good idea to advise your Australian banks of your new non-resident address, to ensure that withholding tax on your interest is correct.
9. File Non-Resident Tax Returns in Australia (where necessary)
If you still have Australian property with Australian taxable income that you must declare, it’s important that you file your Australian tax return as a non-resident.
10. Set Up Your New Home Overseas
Sign a long-term lease, purchase a property, take out life and other personal insurance and club memberships, send your kids to overseas schools, and ensure that it’s clear that Singapore is your new home.
These are just some of the steps that you can take to show that you are a non-resident of Australia for tax purposes.
We hope you find our tips helpful. If you have others you’d like to add, let us know. We’d love to hear from you.
To Your Financial Success!
Jarrad Brown is the trusted fee-based financial adviser for Australian expatriates living in Singapore and throughout Asia-Pacific.
To learn more about how we may be able to help you, please contact us:
✆ +65 8282 5702
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