Tax Considerations When Returning to Australia After Living in Singapore

To the Australians staying in Singapore, a trip home is not a relocation, it is a financial do over. Your tax status is nullified when you resume Australian residency and without proper planning, you may innocently be saddled with some hefty liabilities. The cooperation with the most qualified financial advisor to expats in Singapore would facilitate the transition and be tax-efficient.

1. Knowing the Rules of Residency

Several tests including resides, domicile, 183-day tests are applied by the Australian Taxation office (ATO) to know when you earn the status of an Australian tax resident. After becoming resident again, you pay tax on your global income, including your earnings and investment returns in Singapore or elsewhere. An Australian who is a financial planner for Australians in Singapore may assist you in planning when to make the move so as to minimize the time you spent overlapping and paying excessive tax than is needed.

2. On Assets Capital Gains Tax (CGT)

The ATO treats your overseas assets at their market value on the date that you come back to be a tax resident once again. This reset cost base implies the taxation on gains subsequently will be only after that point. Although, in case you sell assets once you come back, CGT is applicable, the time of the sales prior to or after your relocation is critical to lessen the implications.

3. Superannuation Contributions

All your super strategy might have to shift when you return to Australia. Your contributions when abroad may be handled in a different manner and whether you can make concessional or non-concessional contributions will vary depending on your residency as also well as your total super balance. Ample planning will help you use any tax benefits available in the most suitable manner.

4. Exchange Rates and Foreign Income

In case you still have an income in Singapore e.g. rent, dividends or job, this will be liable to declaration in Australia. Your foreign income must be converted to Australian dollars at fixed exchange rates prescribed by the ATO and this can affect your tax amount with best financial adviser for expats in Singapore.

5. Timing Matters

Strategically choosing your return date can make a significant difference. For example, returning early in the Australian financial year could increase your taxable income for that year, while returning later could spread your income across two years.