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Dec 03 2015

Tax on Foreign Income When Migrating to Australia

ATO Tax on Foreign Income When Migrating to Australia

The Australian Tax Office [ATO] has a 183 day rule:

This is a statutory test to see if you are actually present in Australia for more than half the income year, whether continuously or intermittently, to determine if you are Tax Resident in Australia.

Most reading then says that if you are classed as Tax Resident, your worldwide income must be declared on your tax return.

A new migrant, with 183 days or more in Australia, might then assume they need to declare their income from before arriving.

However:

www.ato.gov.au/individuals/international-tax-for-individuals/coming-to-australia/paying-tax-and-lodging-a-tax-return/what-income-you-pay-tax-on

The above ATO pages states very clearly:

You must include in your tax return any foreign-sourced income you received while you were an Australian resident. Don’t include any foreign-sourced income you received before you became an Australian resident or after you ceased to be an Australian resident.

I will emphasise:

Don’t include any foreign-sourced income you received before you became an Australian resident

For all future years, you MUST declare all worldwide income… But also declare any tax paid in those other countries.

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