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Do I have to pay taxes as an Australian expat? A quick guide

australia flag up in the sky

If you’re here, that means you’re looking to live overseas for an extended period of time and maybe wondering, “do I need to lodge a tax return while living abroad?”

In theory, this should come as a yes/no answer, but sadly it’s not a simple answer! 

There are several rules around tax obligations as an expat, but it depends on your circumstances. For instance, if you have HECS-HELP debt, property or investments in Australia, you’ll be required to make the appropriate repayments or declarations to the Australian Taxation Office (ATO) while you’re away. 

Below we’ve listed some essential information on potential tax obligations.

Key info you must know about Australian taxes and living overseas

For starters, it’s important to remember that everyone’s financial tax situation is different. If you have any specific questions, you should seek advice from an accountant who specialises in expat taxes.

But generally, you’ll need to know if you are considered a resident or non-resident for tax purposes.

Are you an Australian tax resident?

girl on a train in the outback using a laptop

First, you need to determine whether you’re considered a resident for tax purposes. If one of the following is true, you’ll be viewed as a resident for tax purposes:

  • You reside in Australia
  • Your permanent home is in Australia
  • You’ve lived in Australia for more than half of the financial year
  • You or your spouse currently have an Australian job position while overseas.

If you meet any of those circumstances, then you’ll have to file taxes as a resident. If you don’t tick any of those boxes, chances are that you are a non-resident for tax purposes.

What if I’m a non-resident for tax purposes?

Don’t assume anything. You still may need to lodge a tax-related form if you live abroad. 

As a ‘non-resident for tax purposes’, the ATO still expects to hear from you, especially if you have an official tax file number. You will either file your tax return for any Aussie investments/income you have or a ‘Return Not Necessary’ form for the appropriate tax year.

If you fail to lodge your tax return, you can be fined up to $900 per return. This include failing to lodge your ‘Return Not Necessary’ form.

What tax obligations do I have to declare as an expat?

aussie dads with their daughter living abroad

If you’re a non-resident with assets or income in Australia, you’ll be expected to lodge a form to the ATO. Usually, you will only be taxed on your Aussie sources of income, but always make sure to double check with an accountant. 

You’ll be expected to file a tax return if you have at least one of the following:

  • Income from an Australian employment
  • Income from rent on an Australian property
  • Interest income from a bank
  • Dividends received from an Australian company without a tax credit
  • Australian assets from capital gains
  • Pensions or annuities from Australia.

Just be aware that if in any of the above circumstances tax has been withheld, you may not be required to complete a tax return. 

If none of the above qualifies for you, then all you need to do is file a ‘Return Not Necessary’ form.

What happens if I don’t declare my taxes as an Australian expat?

As mentioned above, if you fail to notify the ATO of any potential or lack of taxes, you will be fined up to $900 for each return you don’t lodge. 

The last thing you’d want is to get in trouble with a tax office, so just remember to have a note in your daily calendar during the end of the Australian financial year reminding you to submit the correct paperwork to the ATO.

Making ATO payments from overseas

woman on her phone getting the latest fx rate

If you find yourself owing Australian taxes while overseas, you might want to check out international money transfers (IMT). IMT is when you send money to an account from another country.

The ATO accepts transfers from any currency directly to the Reserve Bank of Australia. You can find the exact account details on their website. 

When paying your taxes to the ATO, remember to send it in AUD. Typically you can choose the currency you want before pressing send.

Currently, the ATO has a partnership with OFX and will validate your payment reference number (which can be found in your myGov account linked to the ATO). Also, the amount of AUD you send to the ATO will not be deducted by international border fees.

If you're an existing OFX customer simply log in here. While new customers can sign up here.

For more information about international money transfers, check out our guides and tips page. Alternatively, if you want to search for more options, start comparing IMT providers below.

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Maria Gil
Maria Gil
Money writer

Maria Gil writes across all of our personal finance areas here at Mozo. Her goal is to help you think smarter about money and have more in your pocket. Maria earned a journalism degree in Florida in the United States, where she has contributed to major news outlets such as The Miami Herald. She also completed a masters of digital communications at the University of Sydney. When Maria isn’t busy with all things finance, you can find her tucked away reading fantasy books. She is also ASIC RG146 (Tier 2) certified for general advice.