# Australian tax responsibilities



## Visiva (Oct 17, 2008)

Hi all,

Does any body know about the tax payable to the Australian government for an Australian working in Dubai with a Dubai residents visa.


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## sgilli3 (Mar 23, 2008)

What do you need to know?

There are a few of us Australians on the forum, who have dealt with tax dept.
You really should speak to an accountant who specializes in tax law for those residing out of the country.

For most- there is no such thing as "tax free".


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## liquid8urn (Oct 7, 2008)

I am looking into this too and this is what I found out from ATO:


*If you are leaving Australia there are things you need to do to get your tax affairs in order.*

*Changing from being a resident to a non-resident*
If your status has changed from resident to non-resident during the income year, answer 'yes' to the question 'Are you an Australian resident?' on your tax return. This ensures you are taxed at resident rates for the tax year. Your non-residency for part of the year is taken into account by a reduction in your tax-free threshold. You are entitled to a pro-rata tax-free threshold for the number of months you are an Australian resident.

In order to claim a tax off-set for a dependant spouse, you must both be Australian residents for tax purposes. You will need to reduce your claim to take into account the period you were both non-residents of Australia.

Non-residents of Australia are not required to pay the Medicare levy, so you can claim the number of days that you are not an Australian resident during a tax year in your return as exempt days.

From the date you cease to be an Australian resident, there is no need to disclose your foreign source income in your tax return. Also, all Australian sourced interest, dividends and royalties derived after you ceased to be an Australian resident are subject to the withholding tax provisions as a final tax and should not be included in your tax return.

*Lodging your return early *
If you are leaving Australia you may in certain circumstances be able to lodge your return early – read Leaving Australia – lodging your return

*Capital gains and going overseas*
If you have been an Australian resident but are leaving Australia while retaining assets here, you need to be aware of the capital gains tax (CGT) implications and your options:

If you leave your home in Australia temporarily you may be able to continue to treat it as your main residence for CGT purposes even while you are using it to produce income by renting it out. 
If you go overseas and cease to be an Australian resident, some of your assets (generally those that don’t have the necessary connection with Australia) are deemed to have been disposed of for CGT purposes, which may give rise to a CGT liability. You may choose not to have this deemed disposal apply. However if you do eventually dispose of the asset the whole period of ownership, including any period in which you are not an Australian resident, will be taken into account in calculating a gain or loss for CGT purposes. 

For more information read Capital gains tax (CGT) and going overseas


*Superannuation*
Temporary residents may be able to access their superannuation benefits if they are leaving Australia permanently.

*Overseas travel and the Medicare levy surcharge*
If you cancel your private health insurance while travelling overseas, you may be liable for the Medicare levy surcharge if your income exceeds the relevant Medicare levy surcharge threshold. Read Overseas travel and the Medicare levy surcharge


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## amaslam (Sep 25, 2008)

I'm interested in this topic, as I've also read this on the ATO website:
Exempt foreign employment income

Your foreign employment income is not exempt from Australian tax if you did not have to pay tax in the country where you earned that income only because of any of the following:

* the foreign country does not impose tax on employment or personal services income (for example, Saudi Arabia), or

***
I think Dubai falls into that non-exempt category. In that case 'some' tax is due. What I would like to find out is what is the typical amount due as a percentage. I.E. you paid 20% of your annual income as tax? 

What are most Aussie expats seeing as their Australian tax liability as a percentage? 10%, 15%, 25%?


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## liquid8urn (Oct 7, 2008)

Amslam, 

Not 100% but I think this applies to people who are in Australia and earn income from abroad.

Also, in the last sentence of the link you provided it states:

*Your foreign employment income may still qualify for exemption if it was not taxable in the foreign country for a reason other than, or in addition to, the non-exemption condition reasons – for example, because:
...
the foreign country levies a tax on employment income but does not have a collection system (for example, a collection system like the Australian pay as you go withholding system). *

isn't this the case here?

anyway, I never heard of anyone who has been in the gulf to have to pay tax in Aus


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## flossie (Jun 9, 2008)

liquid8urn said:


> Amslam,
> 
> Not 100% but I think this applies to people who are in Australia and earn income from abroad.
> 
> ...


If you went to London (for example) to work for a few months, you wouldn't have to pay tax on that income in Australia because the UK and Australia have a double tax agreement. Because the UAE doesn't have income tax, it doesn't have a double tax agreement with Australia. So, unless you become a non-resident for tax purposes, any income you earn in the UAE is liable for Australian Income Tax UNLESS YOU BECOME A NON-RESIDENT OF AUSTRALIA. This is not as easy as just moving here. You have to intend to be away for more than two years, you cannot maintain a home in Australia, you have to limit the amount of time you spend in Australia, you cannot have dependants living in Australia, you have to cancel private health insurance, superannuation contributions, notify banks etc. Honestly, the laws are quite ambiguous you really need to find an accountant who is famliar with foreign earnings (most aren't) to make sure you're covered. If you move here for a year, then move back, you might find you owe the ATO a big whack of money.


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## Visiva (Oct 17, 2008)

*logical*



flossie said:


> If you went to London (for example) to work for a few months, you wouldn't have to pay tax on that income in Australia because the UK and Australia have a double tax agreement. Because the UAE doesn't have income tax, it doesn't have a double tax agreement with Australia. So, unless you become a non-resident for tax purposes, any income you earn in the UAE is liable for Australian Income Tax UNLESS YOU BECOME A NON-RESIDENT OF AUSTRALIA. This is not as easy as just moving here. You have to intend to be away for more than two years, you cannot maintain a home in Australia, you have to limit the amount of time you spend in Australia, you cannot have dependants living in Australia, you have to cancel private health insurance, superannuation contributions, notify banks etc. Honestly, the laws are quite ambiguous you really need to find an accountant who is famliar with foreign earnings (most aren't) to make sure you're covered. If you move here for a year, then move back, you might find you owe the ATO a big whack of money.


Hi Flossie,

Thank you for the information

That sounds right. I would imagine you would have to sell the car, become a non resident and cut all Australian government ties. 

I have one adult son going to University. He is over 21.

I will see an accountant that specialises in expats living and earning money overseas.

Maybe we could meet up when I arrive in early November.

Thanks again

Kind regards

Visiva


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