I have to say that we Australians must rate as one of the most poorly treated citizens of any country in the western world when it comes to becoming a non-resident and I will set out to prove that statement as we go along. As you can tell from this opening sentence I have some strong feelings about this subject and that may shine through in the words I write! This post will therefore have two benefits; you may learn something and I will get it out of my system – a win/win for everyone 🙂
A couple of caveats:
- My experience is based on my over four years of living in Thailand but much of this applies wherever you move to.
- If you are fortunate enough to have a very comfortable retirement income then obviously this information has less relevance. I am aiming my words to people like me who have enough but a few thousand dollars plus or minus per annum makes a difference to the everyday budget.
- I am not an expert in anything except relaxing in the garden so I am not setting myself up to give you the final word on this subject or any other. I will provide some heads up and then you will need to do your own research/take advice and make decisions based on that.
It has been on my mind to write about this topic for a while because there are some aspects to an Australian moving to live overseas that hit the retirement budget some people may not be aware of. I find the “retiring overseas” articles you come across online and elsewhere are often useless in providing down to earth useful information about the practical downsides of changing your country of residence especially on the financial side. They are good at telling you that a decent lifestyle can be had for $2,000 a month in a country like Thailand but don’t warn you about the threats to maintaining your net income once you leave Australia. $2,000 net in Sydney doesn’t necessarily translate to a $2,000 income in Thailand! How does this happen?
Becoming an Overseas Resident for Tax Purposes
Firstly the huge discrimination against long term CITIZENS of Australia happens when the Australian Taxation Department (ATO) classifies you as a non-resident once they decide you have permanently left the country. You are then treated the same as any non-Australian citizen for the purposes of working out your taxation rates. The fact that someone like me, English by birth (dual nationality so the parliamentary career is looking shaky) but I have lived in Australian for 45 years before I left in 2013, and worked continuously since I left school in 1974. By the ATO rules that historical contribution means nothing and once I become a non-resident I am treated the same as some overseas investor.
The ATO definition of an non-resident is very clear and simple. See the last entry on the list:
The online tool for determining residency HERE is equally clear. The Yes/no questions are:
For those ex-government public servants like me the reference to the PSS (Public Sector Superannuation scheme) above only relates if you continue to be a contributing member (i.e. not retired). Once you collect a superannuation pension from the scheme as I do then you are classified as a pensioner not a member. If you think that receiving a government superannuation pension will get you any relief then this ruling HERE stops those thoughts dead. An extract says:
And the biggie:
And the result? You may as well not be a citizen and we will treat you like a foreigner for tax purposes.
There is no tax free threshold. You pay tax from dollar one! You not only pay from dollar one but you instead on the normal tiered rate starting at 19% you pay 32.5% up to $80,000. The normal rates are:
But for you we do a special deal like this:
So let’s say you are Joe or Sue average retiring on a modest superannuation or pension income of $40,000 pa. If you stay in Australia and use all the public facilities provided by the government; roads, infrastructure, medical, police, etc then you will pay $4,547 p.a tax excluding Medicare Levy. As a non-resident using none of the facilities you would if living in Australia you will pay $13,000. I find this discrimination one of the most upsetting things about leaving Australia. I can sort of understand the desire to treat non-citizens in a different fashion, those who maybe have only lived/worked in Australia for a short time and then extract an income once returning home. What I struggle with is the logic of determining that as a long term citizen the country you choose to live in determines the tax rate you pay. I know that expats from the UK and the USA don’t pay more and suspect that many other first world countries are the same. What has Australia got against its own citizens and especially retirees that treats them this way? Shouldn’t government be encouraging older people to become the medical/old age problem of another country!
My rant over and I feel better but no richer. Now you beating the tax system is a national pastime and I guess you can have a go at this if you want to. I know of Aussie expats who maintain a residence back home or set up an “address” and then take many long “holidays” in Thailand. If you have a residence I think you could have a good try at saying you haven’t left the country permanently and that would work. If like me you needed the capital from my home and I have no intention of returning home to live or for regular holidays then it all becomes a bit iffy. Beating the tax system is a good thing until the ATO find you out and then your retirement plans might go out the window with repayment schedules and fees. I don’t want to live worrying about a letter from the ATO so I declare and suck it up – but not gracefully.
If there are any Aussie out there that have come up with a workable solution you can write to me privately or discuss in the comments section.
So my obvious warning is that when planning your available retirement income once you leave Australia and move to Thailand or elsewhere is be very sure of your residency status and budget to the reality of becoming a non-resident if that’s the outcome. It will make a big difference if money is a little tight.
The Age Pension
Another area where Australia leads the world in discrimination against non-residents. Not only do we means test the age pension eligibility for both income and assets, something neither the retirees from the UK or the States have to worry about as far as a know (subject to eligibility of course), but then as a non-resident you have to return and become a permanent resident of Australia for two years after pension approval to “lock it in”. If you don’t then as soon as you leave the country the pension stops. Centrelink and Immigration are spot on with their ability to remove payments and slower to approve! If you are already a resident, claim the pension and then leave the country no problems apart from the non-resident tax rate.
I am on that awkward income level where I don’t have a huge income but just enough to stop me receiving an age pension once I reach that time and in true Aussie “Lucky Country” 2018 standards that time gets later and later:
Even if I was eligible I would have to return to Australia, claim the pension and then live there for the next two years. Once again why? If I am eligible for the pension because I am a citizen and lived and worked there for the nominated period then why does it matter where in the world Centrelink makes that payment? Another absurdity designed to cause the most hardship for the least possible result. Any logic? Maybe someone can explain.
Exchange Rates
Not a specific winge because exchange rates are a general fact of life and not Australian specific but I add it as a “beware”. When making your calculations for living in Thailand or wherever you plan to retire do make sure you are realistic about exchange rates. When I first came to Thailand I was getting 28/29 baht to the dollar. It has been on a steady decline since then and I budget for an average of 25 baht/dollar. It is no use being overly optimistic and expecting that the days of 30 plus baht exchange rate will return. I was here when that happened but there was this little military coup that caused that uncertainty so I am not hoping for a repeat.
A Five Year snapshot of the movement in Baht/Aussie Dollar exchange Rates.
As an illustration of what can happen I have an English mate who was financially comfortable in Thailand until Brexit happened which wiped 25% off his income. I know you can’t plan for a disaster like that but do be pessimistic and plan for the worst.
The Cost of Living
This is a topic I have covered in other posts but I will touch on it as part of this general financial reality check on retiring to Thailand.
The low cost of living is one of the big pluses highlighted in those retire to Asia type one pagers with pretty picture articles. In Thailand this is a yes and no response from me. You can live here incredibly cheaply if you drop your standard of living to say a rural or building worker or someone serving in a 7/11. They are getting 300 baht a day (A$12.00) and often by pooling with family, but not always, they can get by. You can rent a place for $120.00 a month but “basic” would be the word I’d use to describe its features (if in fact there were any!) Thai takeaway is great on a Friday night in Australia but as an everyday option for the rest of your life it might not be so attractive. If you move to live in the north east, which is where we are, a region called Isaan (Isan) then they eat Isaan food not Thai and there is a huge difference. Isaan is very rough “poor rural” type food, highly spicy and incorporating just about anything that has legs and a lot of things that don’t 🙂
If you, like me, wanted to replicate the standard of living you have enjoyed all your life then Thailand is CHEAPER but not necessarily cheap. What is cheap are things like:
Building – I have a beautiful highly specced home sitting on 2,000 sq mtrs of tropical landscaped gardens and it has cost me very little by Australian standards.
Labour – anything involving the cost of people. Getting a car serviced the new oil costs several times the labour charge.
Food – if you buy what the Thais eat it is mostly cheap.
Utilities – we have our own water (bore/well), sewerage (septic) and dispose of our own rubbish (burnt at farm) and pay no rates or utilities. Even where some council services are provide it is cheap (refer labour costs)
Power – probably a cheaper rather than cheap although I believe the cost of electricity in Australia has skyrocketed over the last few years. I am a heavier user because we have a seven water pumps of varying types and I use storage hot water rather than the instant. Watering our gardens in the long dry season is expensive. My monthly bill averages about $100.00 a month a bit more in the hot season when we use some air con and water more. The plus is that there is no “base” charge in Thailand. If you go away and use no power (in theory) then your bill will be zero.
Clothes – non-label everyday casual clothes. If you pay more than $8.00 for something you are being ripped off! Obviously you can spend whatever you want in the shopping plazas and specialised places in the bigger cities but it’s optional.
Domestic air travel – international too in some respects because you are partly on the way to Europe and central to many Asian countries. Domestic air travel is everything Australia isn’t. Plentiful choices, even out in the sticks as we are, lots of specials but even paying full price it is cheap. I just received an email for these Nok Air specials:
One way from Bangkok to Udon Thani, our nearest airport. which is an hour’s drive from home = $16.00 including 15 kg baggage. Why drive?
Plants – I had to throw that one in for those of you following the development of our new tropical garden HERE and HERE. Super cheap and plentiful.
Holiday Accommodation – once again you can spend whatever you want such as the Siam on the river in Bangkok, which is where we always stay (in my dreams)
At $1,700 a night why not kick back for a few days?
Funnily this “River View” pool villa is top of the range. If you have seen the Chao Phraya, the river that runs through Bangkok, I would pay money not to have that view. It isn’t one of the world’s great scenic attractions 🙂
Back on topic – for everyday “just a bed” accommodation $20.00 a night will get you something basic that does the job. I guess what I am saying is that there is a broader range of price options available here than back in Australia.
Medical/dental – Medical is cheap if you use Thai public hospitals but you will be in a very busy and “Thai” system. High class it ain’t on the whole but like the cheap accommodation will do the job given patience. Local doctors shouldn’t cost you more than $4.00 a visit and a dental filling $20 – 25.00.
Speeding tickets – not that I have had one (yet) but $40.00 and no demerit points will get you back onto the track again. If you have the money speed away.
Updated 12 Feb 2018: I forgot the beer!!! A reader kindly pointed out my error. Alcohol falls into both cheap and expensive categories. Beer is cheap. U beer (a Singha product), if you can find it is $16.00 a case of 12 bottles. Chang, Leo and Singha are around $24.00. Heineken is $32,00. Gin is cheap at $16.00 a 750 ml bottle but run is nearly double that for some reason.
I am sure there are other cheapies but you get the point.
Expensive:
Medical – do your research. Once you hit private medical outside the Thai public system this is a cheaper but not cheap expense. Medical insurance is expensive, probably what you’d pay in Australia but it is age based so becomes very expensive once you get over 65. Lots of information online so do your research.
Western Food – if you want to include some or all the food you are used to in your diet here then this is a cheaper (maybe) but certainly not a cheap expense that you will need to allow for. For example a breast of chicken (A Thais also eat them item) will cost you $2.40 a kilo however a 2 litre milk (less Thai orientated) will set you back $3.70 the latter being cheaper but not cheap. I thought it was funny because we recently went to Makro, originally a Netherlands owned supermarket chain but in Thailand now owned by the largest private company in the country who also own the over 10,000 7/11’s here.
Gaun’s purchase for the visit was a 40 baht packet of cakes for Peng. My bill came to around 1,500 baht ($60.00) and it was a list of farang essentials reading such as:
- Bread – 34 baht
- Milk – 91 baht
- 500 g smoked ham – 155 baht
- 1 litre cream – 149 baht
- 1 kilo cheddar cheese – 375 baht
- Aussie mince 1 kilo – 295 baht
- 1 kilo spaghetti – 79 baht
- x 2 220 g butters – 160 baht
- 100 g Parmesan cheese – 129 baht
- Yogurt x 4 pack – 52 baht
All of which shows that you can take the Aussie out of Australia but you can’t take the Australia out of the Aussie! I know of many expats from different countries that mix Thai/Isaan eating with home-style as I do.
Electrical and things like cameras – around the same or more expensive than Australia.
Imported cars – maybe a little cheaper but certainly not cheap. Thai built cars and utes are probably cheaper but sometimes under specced (my Nissan NP300 only has 2 airbags while the Aussie one has seven).
Wine is very expensive by comparison to Australia. A bottle of Jacobs Creek Chardonnay (not a world leader but good everyday drinking) is $8.50 at home and $27.00 here. There must be a huge tax on all wines. You can find a few decent Aussie wines at the $14.00 mark but the majority are $30 -$40.00.
Once again I have run out of ideas on this topic but it was never meant to be an extensive list. I did write a Cost of Living post some time ago that maybe still somewhat helpful and you can find it HERE.
I hope you have found this post useful in touching on some of the realities on the financial side of retiring to Thailand. All in all the fact is that in my case, even despite the frustrations, I can afford to live a simple but very comfortable retired lifestyle here while back “home” I would be retired in a caravan or still working. I know what my preference is:
I hope this post generates some involvement from readers. I don’t want to stir the negative pot too much but would prefer if contributors would expand on the information I have provided as a helpful resource for those who follow. If you want to get in contact outside this forum then please leave a comment to that effect and I will pick up your email from that.
Thank you for reading.
NOTE: This post has generated a lot of interest and there are some excellent comments below that raise further issues you should consider. PLease take the time to read them if you are in the target readership of this topic. It is all a bit depressing but better to be fully informed before you make that final decision to move overseas.
Hi Tony, many thanks for all that you write about and the knowledge that you pass onto others. Myself, I will retire at 66, in about 18mths. Although we won’t be living in a rural area as such, I always enjoy reading what you’ve been up to in your Isaan world.
My Thai wife and I will live in Hua Hin, where we plan to stay for at least 6-8 mths of the year. We’ve both got children and grand children, plus friends here in Australia so we’d like to visit them each year. Your right when you say money isn’t and shouldn’t be the motive for retiring to another country, although the way things are going it’s certainly gone up the list as a priority in considerations, especially as I will be on the pension. I keep coming back to the idea of spending time in Thailand, and coming back to Australia in the warmer months, especially so in Victoria where the winters aren’t nice. That’s about all from me. Hopefully down the track, we can catch up, cheers for now, Frank.
I am sure I have said it before Frank but it is a pleasure to keep on publishing the stories so as to get feedback like yours.
I think time here and time back ‘home’ is an ideal compromise, especially when you have family as you do (and I have seen the photos and a video to prove it). I saw someone post on Facebook a photo of them having a cheese platter and glass of red wine at Maggie Beer’s farm and that’s the sort of experience I enjoyed doing when I lived in Australia and an aspect I miss especially when living more in the Isan ‘bush’ as we do. In Canberra my ex and I used to enjoy visiting a winery at a weekend for a lunch, some wine (of course) and maybe listen to a live jazz band. Thailand misses out on a lot of stuff like that and retired life is more basic as a result. Mind you doing those sorts of things requires excess money and that is something I don’t have much of, so maybe not having the temptation is better for my budget 🙂
I have friends Hua Hin way, or planning like you to retire there so I am sure we will meet up at some stage.
Always great to hear from you mate.
Cheers.
Tony
Tony, thanks for alerting me to this potential nightmare. I am a current PSS member, but considering retirement in rural Japan sometime in the next decade. I will certainly be seeking professional advice! All the best! Ian B.
I am pleased that this post has been helpful to you. I would like to think that such a piece of illogical discrimination against citizens would be reversed but in some areas they seem to be even more keen to ‘get’ expats. If I was a politician I would be giving incentives to get people like me dumped on other countries and not draining the resources of Australia, but that all sounds too sensible.
How interesting to hear you are planning a retirement in rural Japan. For obvious reasons all my readers are Thai-centric. We tend to think of Japan as urban in the same way outsiders think that kangaroos bounce down streets in Sydney, but I have seen photographs of Japanese countryside and it looks stunning.
Good luck with your planning and thank you for responding to the post. Most don’t.
Cheers. Tony
In a ‘former life’ if you know what I mean, I did many business trips to Japan. Long story. Part of one trip was in a Race Van with a former National Japan MTB Champion. He’d reached the age of being Team Manager, and we travelled country Japan from one MTB race track to the next, following the National Championship, with his Van full of 8kg million dollar bikes. I saw places my Japanese friends in Tokyo & Kyoto told me they had never seen. Places so beautiful, so grand, so pristine. Truly amazing. I still also remember my then GF taking me to see a ‘special mountain’. She covered my eyes with her hands and then said open your eyes, this is Mt. Hodaka. (Used as a brand name for a unique MC, maybe one of the first mass produced cheap trail motorcycles ever made in the late 60’s early 70’s. I owned a Hodaka years before and I got to see Mt Hodaka with my own eyes. Obscure but unforgettable memories of maybe the most beautiful countryside I have ever seen.
PS: Tony. You know me off Cheap Charlie etc. Also Energy Efficient Building Design / Building Physics.
How interesting Alan. The connections we make and the unexpected outcomes they sometimes result in. Great story.
All the very best for the future in Japan.
Tony
Hi thanks for the article but i’m confused after reading this decision by the ATO https://www.ato.gov.au/law/view/document?docid=AID/AID2004971/00001 which says the pss pension is not assessable income as a non resident- so is tax free but possibly taxed in Thailand.
Hi Andrew.
A very interesting link that I will follow up to gain a better understanding of that ruling. I really appreciate you sharing it.
I will report back.
Thanks again.
Tony
Thanks for that link Andrew. The potential problem on first reading is that the ruling is based on a Spanish citizen returning home to live permanently who is receiving a PSS pension. In that situation it seems as if the tax payable in their home country overrides the tax that would otherwise be payable in Australia – no double taxation. If I was a Thai citizen receiving a PSS pension and came back to Thailand to live then I presume the same would apply. The potential problem I see reading that ruling is that as I am an Australian citizen now classified as a non-resident, there’s no obligation to pay Thai tax, which then pulls me back into the Australian tax regime.
I also have a British passport so I wonder if I revoked my Australian citizenship whether I would then be classified as a UK citizen and taxed under their rules, which do not penalise non-residents in the same way Australia does?????
I will seek advice and report back any findings.
Thanks again.
Tony
Hi Andrew,
Just a couple of links you might like to explore on the subject you raised. This is an interesting debate on ThaiVisa. It starts off a bit slow but gets more informed later HERE. This is a definitive ruling on an Australian citizen receiving a PSS pension while classified as a non-resident from the ATO HERE
I have heard from a number of expats who arrange their affairs to have an Australian address while basically living overseas. This is all well and good unless the ATO decide to match resident status with how long that taxpayer has been out of the country. That information is readily available and all the major government computers are linked i.e Centrelink knows immediately a pensioner leaves the country and the pension is adjusted accordingly. ATM because we are small time it is unlikely we will be audited and ‘found out’. However, if the ATO decides to run a blanket check and then demands back payment of tax owed plus penalties that would be of concern to many. I prefer to accept this bloody awful situation, just pay up and sleep at night. Each to their own.
Cheers.
Tony
Hi Tony. My second comment in as many days. I read with great interest and not some small alarm your blog, “Australian’s – Beware.” Having just invested a small amount of money in the Australian share marked I had reason today to contact the ATO re the process of filing a tax return for the purpose of claiming “Franked Credits” (because I am in receipt of a disability pension I haven’t needed to file a return for some years and needed advice).
While I was at it, I mentioned that I was weighing up my options of moving permanently overseas once my age pension is granted. I asked them if it is true that I would get taxed 28% of my pension and not be entitled to Franked Credits on my investments once it was established that I was not longer an Australian resident.
After a few minutes away to seek advice, the ATO person advised me that neither of the above are correct. She said that the tax rate did not change (provided I was not earning an overseas income) and that I would still need to lodge an Australian tax return and still be eligible for Franked Credits on my investment.
So, now I am in a quandary. Who is right and who is wrong? I would be remiss to ignore what you put up on your blog as incorrect as it seemed to come from official ATO information. I do note, however, that the taxation method for “non-residents” also had in brackets “after adjustments,” from memory. I wonder what those “adjustments” actually mean?
All of this, together with your other recent blog re changes to Thailand’s immigration policies, have created a nightmare obstacles to sort out and attempt to understand before I can make a correct and proper decision as to my (and my partner’s) future.
Fortunately, I do have two more years in which to sort it all out, at which time I will be eligible for the age pension in Australia. I hope that one day not long after that date we can meet in the flesh and have a light-hearted chuckle about the many things us farangs have to overcome just to be with our loved ones overseas.
Cheers mate
Mel
Hi Mel. I am working on your first comment and will reply to that separately.
I think it would be worthwhile to invest in some professional advice when you get closer to making a final decision about moving here. I didn’t because it never entered my head that I would be treated differently as a non-resident citizen taxwise. It wouldn’t have changed my choice but at least I would have made a fully informed decision. The criteria of whether you are or aren’t a non-resident is super basic and simple. There’s no ifs and buts according to the ATO online guide. I know of several readers who maintain a theoretical ‘home’ in Australia to get around the classification, but using that ATO criteria they are actually non-residents. Maybe they will never be found out but I don’t think that messing with the ATO is a good basis for a relaxed retirement 🙂
The changes to the Thai visas, especially the possible medical insurance requirements, is another unknown. At least that aspect will be sorted one way or another before your move here. I believe there was a move to remove portability for the pension recently that didn’t go anywhere, so you’ll obviously keep an eye on that aspect too. All in all, it’s not as easy as you’d think but the end result is worth it, or that’s been my experience anyway.
I hope you meet you for that chuckle sometime.
Tony
Hi Tony,
Just picking up on the medical insurance issue here for us retirees.
I decided to bite the bullet and get it sorted out because from what I have read, once you hit 70 it is very difficult to get it, because I’m now 69+ a bit, plus I have a pre-existing brain issue that has left me with very limited use of my left hand. No big deal!
I went with AIA, American Insurance. I checked out quite a few options, but decided on this one as there was no issue about my condition, other than anything to do with it would be excluded, just as it is in Aus. No need for a medical, as I gave a copy of my recent blood tests in Aus.
I dealt with a delightful lady Wanna Vongsasurarit.
The policy is for 1 million Baht per year with a maximum of 500,000 per event and 10.000 life insurance.
Unfortunately it is bundled with an additional 100,000 life cover which adds about 7,500 Baht pa to the premium.
So the bottom line is full cover for 59,190 pa (AU$ 2,630 at our ever dwindling dollar). Very similar to the cost in Aus from what I can remember without the life cover.
I can highly recommend Wanna, she has reasonable English, super efficient and call on you just about anywhere in Chiang Mai. Should anyone want her contact details, please just let me know. No, I’m not getting a ‘kick back’!
Thanks for the continual blog updates.
Thank you for that information Brian. I will also add it to a separate post I have on medical insurance in Thailand. I will get a quote from them myself as my insurance, currently with Pacific Cross, is due for renewal in June.
Cheers.
Hi Tony,
Just re-reading some of the posts…. One thing I think everyone has forgot is our Visas… And the changes that have just been announced could have some big impacts on people…
We were married in Australia and I have been looking at getting it recognised here but it all seemed too hard.. But now with the possible visa issues I may have to re-look at it…
Hey Tony always good reading replies to your blogs and can truly appreciate your frustration as to how Australia includes it’s citizens who choose to live abroad as non residents for tax purposes, that said, as far as the old age pension goes, I note in your post you mentioned that non residents get taxed on it, that said, I think you will find that they don’t, although I am not on the old age pension, perhaps someone can clear that up.
I do want to mention, in case I haven’t before, the only real way a non resident can avoid paying the 32.5c in every $, if fortunate enough like myself, having funds from the proceeds the sale of a property, is to invest in the Australia Stock Market, buying fully franked shares, i.e. the tax is already taken out by the company before you receive your dividend share, plus capital gains made are not taxed, so there is a loophole for us non residents, as for anything else, like retaining property or earning an income from Oz, It’s unfortunate that one glove fits all as far as the taxman is concerned.
As one can see the stock market is a volatile place to be in at the moment, so one can put their money in the bank and earn basically little on interest rates at the moment and pay 10% tax on what is earned, however the way I look at it is, if you have the $’s and do buy blue chip stocks, you can earn between 5%-6% tax free on your money invested, and even if your shares do go south as mine have, i.e. 30%, I am not bothered, because the returns, which in my case are double what I quoted above because I also involve myself and buy and sell as well as hold stock for their dividends, all of this being tax free when transferred to the Thai baht, even though the Oz $ has been going down, one can still have a comfortable life here in Thailand if they have their house and car paid off.
I earn on average 100,000 baht per month on a $500,000 AUS which equates to 10.43% tax free, now that’s not bad considering, and of course, if your shares are down you don’t sell.
The above said, it pays to have the same or at least half that amount in the bank as a backup, I did say, if you one was fortunate enough to have funds, from either the sale of a property, or has a property back in Oz, then they might want to stop paying 32.5c in the $ and start earning some tax free $’s by putting their money to use, however with all advise I provide, I always say seek the advice of a qualified person, I didn’t, although I did enough research myself to work out that I didn’t need a broker to make what I am making for his advice, other may require their assistance, but you will pay for it, each to their own.
As for you paying tax on your superannuation, that sucks, and if there was a way you could take it out without paying tax as a non resident, I would suggest you look into the above, because if it can work for me it can work for others, but with anything that involves money, it has to be looked at as a long term investment, and shares are something you must look at as something not to panic over if the market dips, it’s just the way it goes, and there are up sides too, so one can take profit if they want to and go back in when it dips, it’s up to the individual how they play the market.
I hope this gives some options to some of your viewers and yourself, and with regard to fairness, there never was any as far as the Australian government is concerned, they will take and keep taking and give to those who have never contributed, it’s just the way the stupid system works, so no point in getting all worked up about it, although I know exactly what your on about and how you feel, however keep looking for alternatives/options, and that fails, then think how lucky you are to be sipping on some fine tea with zero stress in Thailand while the rest of those who feel that they are in the lucky country, work it out for themselves eventually.
Hi Tony,
Found you by accident but glad I did. It would seem we got here about the same time, the good ‘old’ days when we were getting 30baht to the $AU…. Just yesterday I say it at TT for 22.75.. EEEek It has bounced between this and 24 for the last few months… I budget for 22 as I would rather under quote than over…
I am one of the lucky ones who qualified for a Defence Pension after 20 yrs service, I left after 22yr… Although it was more of a bonus than anything whilst I continued to work in civilian life now that I have stopped there is no way I can live in Australia on what I get each fortnight….. OK, that might be a little dramatic, but it would be very difficult and I would have to forgo motorbikes, cars etc that I had before I stopped work.
I can however ‘holiday’ very well without lifting a finger. I too have a Thai Wife, we stayed in Aus for nearly 15 months on one of her Visa’s we got and as much as she loved it there is really no place like “home” and the family.
Due to some medical conditions I do go back to Aus about every 5 months and I have done the sums of the medicines I could get here (2 I couldn’t) because of our PBS system it is still cheaper to fly back home to get it all, and it’s a good reason to catch up with family and friends.
And I must say things may have changed here in Thailand in 5 yrs, but no where near what they have back home…. I am truly sorry what my generation is leaving my kids and grandkids. There are many times I am frustrated here (driving and parked cars for instance)but I then just think about what I witnessed last time I was home and things suddenly seem so much better here. 🙂
Don’t get me wrong I love Austrlaia, but it’s not what it used to be. I miss our beaches, the blue skies, lamingtons and throwing a juicy Aussie steak on the barbie. There a re pages full of stuff I don’t 🙂
My Wife lives on the Darkside, I just visit 😉 and we have a house and everything that goes with it including utilities for less than I would pay rent for back home. My oldest Daughter has a lovely home and family, with ducted Aircon but does not use it often as the Elec bill is just too scary… Me, I have it on every night to sleep and I am still under $100 a month….
And when all is said and done when I sit back and wonder if I made the right choice… I remind myself that if I was back home I would still be working… That though alone puts everything back into perspective. 🙂
Thanks for the article.
Hi Shaughan. Sorry about the very slow reply. Between the beautiful Isan cool season weather, the social events of the season and lots of visitors I have kept away from the computer for a while. Catching up now.
Thank you for your comment. I can relate to most things you write about. The drop in the dollar to the baht has dried up what used to be my ‘play’ money. Thankfully I have little incentive to do a lot (or any) travel and I have moved beyond the purchase of things to relieve boredom or satisfy ego requirements. In a previous life a larger TV or better something would be high on the agenda and added to the credit card. These days I just make another cup of coffee and wander the garden, which I can afford!
I can totally relate to the things you miss about Australia. As always if one could combine the best of both worlds life would be truly perfect. Having said that given a choice between the Thailand and Australia I would always choose Thailand. My wife Gaun and I went back to Australia for our honeymoon and to settle up affairs in early 2014 and it all felt so sterile and controlled even back then. I spent more time looking at my speedometer than the road because of the Big Brother attitude to driving. You cannot legislate to make life risk free. I know that I would die of boredom had I retired in Canberra and despite the rubbish exchange rate, like you, there is no way I would be retired at 57 (five years ago) in Australia. I have never been happier than I have here and long may that continue.
Comments and little insights like yours are why I keep the blog going so I really appreciate the contact you have made.
Keep in touch.
All the very best for 2019 and warm regards.
Tony
Thanks Tony, that was quite informative. On a whim, I was wondering what would happen if I moved to a country like Thailand on my CSS super and found this.
I thought I could move there and live like a king and still be considered an Aussie, despite moving. Wrong and wrong lol.
It isn’t a serious option now, like I said it was just on a whim. Enjoy your life. Cheers, Max
Hi Max.
Despite the discrimination of the tax system in Australia I estimate that the overall cost of living is about 50% less than an equivalent lifestyle back ‘home’, so you would still be ahead. There’s a lot more to any decision about moving overseas than the money of course, and some people forget that and regret it afterwards. It is such and different culture and expats are remote from friends and family so it can become lonely and isolating. Many make the compromise and cope just fine, like myself, while others struggle.
Thanks for your comment and I will take your advice and continue to enjoy my Thai life 🙂
Cheers mate.
Tony
Hi Tony and Tony’s followers, I just thought that I would see if there are any Non Residents here living in Thailand who have their principal place of residence back home in Oz, why, because I am delivering very bad news, that said, if there are some Non Residents living here in Thailand who have their principal place of residence back in Oz, they might get wind of this and sell up in time before the new changes come into effect on 1 July 2019, therefore saving potentially hundreds of thousands of additional capital gains tax $’s. I have copied and pasted an email that I received this morning, and whilst it is lengthy, the long of the short of it is to scroll down to Example 1, it will knock you off your feet, to add, the capital gains tax will be 45% as of the date you purchased your principal place of residence and there will be no usual 50% capital gains tax discount if you held it for more than 12 months as an investment, i.e. rented it out, and the 6 year rule won’t apply as well, this is the kick in the guts when you thought you had something to fall back on. So please have a read, its educational and if you know of someone who has their (principal place of residence) back in Oz and is a Non Resident or not, please tell them about this change which comes into effect on 1 July 2019.
Copied and pasted extract of an email below which was sent to me today, and if this post is going to save you a few bucks, send me a carton of San Miguel light…lol and it will make the effort all worth it for me.
But before you read the copied and pasted email, just remember to run it by a qualified accountant before you sell up.
Start:
You’re probably busy doing what you do best so we won’t keep you long.
Recently you reached out to us about your Australian taxes and since the 2018 Australian financial year just ended, we think now’s the perfect time to let you know about a bunch of recent tax rules that have the potential to affect you.
I’m Shane Macfarlane, the founder and tax advisory partner of Expat Tax Services. My goal is to update you about new and recent Australian tax rules that may affect you and many other Australian expats living and working around the globe. By providing you with valuable information about these rule changes over the coming few weeks, you’ll be able make timely decisions so that you’re not caught unawares and so that you’re not slugged with high Australian taxes unnecessarily because of a lack of planning.
And this week, we start with a look at some harsh new rules seeking to scrap the main residence capital gains tax exemption on the sale of your family home!
Main residence CGT exemption to be scrapped – Australian government lays siege to expat family homes!
Your family home has always been your castle, but with recent changes to Australia’s capital gains tax main residence exemption for non-residents, your castle is under serious attack by the Australian Taxation Office (ATO).
Public policy in Australia has always been that Australians should not have to pay tax on any capital gains made on the sale of their family home (providing certain criteria were met).
However, for Australian expats and non-residents generally, that’s about to change!
What’s changing?
Back in early 2017 we warned our clients about the Australian government’s 2017/2018 budget proposal to scrap the main residence exemption for Australian expats (and other non-residents) with a harsh new rule slated to kick in from as early as 9th May 2017.
Basically, the new rule means that if you sell your family home while living overseas as a non-resident, you may be taxed on every dollar your home has increased in value since the day you purchased it.
Under the old rules, 100% of those gains would have been totally tax-free!
Worse still, your gains will be now be subject to tax at Australia’s punitively high non-resident tax rates of up to 45%.
A small window of hope
Although these harsh new rules apply from 9th May 2017, the Australian government has applied a grace period for existing properties, but only until 30th June 2019.
So if you’re like the majority of our clients and you own a family home back in Australia, there’s still hope because you will have a small window of opportunity to sell your home prior to 30th June 2019.
After that date, if you are a non-resident, the main residence capital gains tax (CGT) exemption on the sale of your family home will be abolished, regardless of whether you are an Australian citizen or not!
Now, it might seem like 30 June 2019 is a long way off, but remember that real estate markets can be seasonal.
How will your property perform in the summer, autumn and winter of 2018/19?
If your property will do better in the spring – there’s only one season left to go!
How will this affect me?
We feel that these new rules are inherently harsh and unfair as we believe that it will force many long-term Australian expats into making a major life and financial decision much earlier than planned.
For example, we believe many Australian expats will be forced into:
1. selling their family homes much earlier than planned (before 30th June 2019)
2. cutting short their overseas expatriate role and returning home to Australia much earlier than planned; or
3.deferring the sale of their family home until they eventually return to Australia, even where this is not convenient.
Additionally, these new rules are so punitive for non-residents that overseas and Australian employers may find it more difficult to hire and relocate Australians to work overseas.
It’s also worth noting that given recent increases in Australian property price over the last few years, particularly in Sydney and Melbourne, Australian expats may have accrued significant gains in Australian property.
Here a couple of case studies to explain further
Example 1 – CGT applies
Sarah acquired a dwelling on 10 September 2010 for $200,000. As soon as practicable she moved in.
On 1 July 2018 Sarah got a job in New York and moved out but unfortunately she could not sell her property in time before she left Australia to take up her new role.
On 1 August 2019, while resident in New York, she signed a contract for the sale of her house at a sale price of $1,200,000.
The whole profit (totalling $1,000,000) on the sale is subject to capital gains tax at Australia’s non-resident tax rates of up to 45%. Had she sold the property before 30 June 2019, the whole of the profit would have been tax-free.
It doesn’t matter that the house was Sarah’s main residence for the vast majority of the time that she owned her home, CGT applies on the full amount of the gain.
Example 2 – CGT doesn’t apply
Jessica bought her home in February 2003 and moved straight in.
She sells the house in 2020, but between those two dates she spent considerable periods overseas, and when she did so, she rented her house out.
From October 2007 until March 2011 she lived in a rented apartment in London.
She came back and lived in her house from March 2011 until she went to Hong Kong until 10 June 2017. While she was in Hong Kong she rented her house out.
When she came back in 2017 she lived in her house until she sold it in 2020.
There is no CGT on the sale because at the time Jessica is resident in Australia.
What this means for you
If you’re an Australian expat, contemplating an overseas posting, or if you run a company that has employees overseas, then it’s important to understand how these new rules introduced into parliament will affect you.
In fact, we believe more than 90% of our expat clients will need to consider, sooner rather than later, whether or not to sell the family home.
If you think you fall within that 90%, we highly recommend that you book a tax consultation with us at (below) page to learn how these changes may affect you.
Book an Appointment
Because when someone is laying siege to your castle, to be forewarned is to be forearmed.
What’s up next week?
Next week, we’ll take a look at how recent tax changes to Foreign Resident Capital Gains Withholding Tax will impacts expats who are considering selling their Australian property.
If you have any questions in the meantime, please hit the reply button and drop me a line.
Until next week,
Shane Macfarlane CA, FTA, B.Bus. | CEO & Founder
Wherever you are, whatever you do . . . we’ve got your Australian tax needs covered
http://www.expattaxes.com.au
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Just a quick response Angelo as I haven’t yet read through your comment in detail, which it needs. Thank you once again for your thoughtful contribution to the blog on this subject (Aussies living overseas being ripped off). I will not only publish it as a separate post here but also spread it around several Facebook sites that I am involved with. The more coverage the better.
Much appreciated and I hope the cases of beer flow your way as they should.
Tony
Regarding tax residency, recently my Australian bank (Westpac) asked me to complete a section asking what my tax category was. Resident or Non resident. I do transfer large sums to Thailand regularly.
There is a section for this in the personal details area.
Possibly of concern for some.
Hi Terry
We just went through the same process with our bank ING whereas we had to answer a lot of questions. It is now compulsory for banks to identify their overseas customers and pass that information over to the ATO, for one its to do with reducing money laundering and of course to make sure everyone is paying the right amount of tax, if required. I have attached a link below for those interested. Also the bank should contact you via email so that you can confirm that it is them that want your information, generally speaking you can call them back on a free call number as the process takes time.
https://www.ato.gov.au/Individuals/International-tax-for-individuals/In-detail/Foreign-residents-reporting/Foreign-tax-resident-reporting/
It is an ever closing noose around our necks. Government at war with its citizens.
I’m from Adelaide Australia but live in Chiang Mai. Heres an Elec. price comparison, as this has become a pet subject of mine, esp. to those who ask why I live in Thailand. I’m a former TAFE Adelaide Renewable Energy & Building Energy Efficiency Lecturer.
Electricity in Adelaide is about AUD 45c a kWh (I have the Elec. Co web pages to prove it) and its 3.5 Baht AUD$0.15c per kWh in Thailand. (I have my own power bills to prove it). I lived in Phuket 18 months ago and it was the same price. Thai kWh = 3.5 Baht. Calc. 100/23.5 exch rate = 4.255 x 3.5 Baht = AUD$14.89c = AUD$0.15c.
Therefore Adelaide is genuinely 3 x more expensive per unit of electricity, and thats before you also look at Australia’s privatised Elec. Co ‘service and connection fees’.
Wow. That’s quite a difference ‘Biggles’. I have been out of Australia for five years now so have lost touch with comparative costs. I did know that there has been a lot of focus on the cost of electricity and the usual total lack of leadership by politicians who prefer to argue their philosophical views of coal vs renewables while the ordinary people pay ever increasing bills. As you say the other aspect to take into account is that there is no ‘base’ cost here. You are only charged for what you use, while in Australia there’s a substantial amount on your bill even if you haven’t actually used any electricity.
Cheers.
Tony
Any service in Australia, such as Water,Electricity & Sewage……even if not connected……if it is available…..you pay a base rate……I don`t LIKE it but think it is fair…..setting up & maintaining these services COSTS !….do you know a better way ?
I totally understand the reasoning behind a base rate Clem and was not making any criticism of the concept, which your reply seems to imply. All I said said was that when taking into account the difference between the living costs of Thailand and Australia, this aspect is a plus for Thailand. Long may they continue not to apply the same Aussie logic to electricity cost here!
Cheers.
good morning to you Tony,
re.my comments….nothing implied….just facts,,,or as the Govt.puts it…Legislation !…..covers them for a lot.
When we get to OZ…I`ll be taking them on re.cuts to my pension `cause I married whilst o`seas……no common sense….just Legislation.
And how`s this ?…..because I`m my wife`s sponsor for her Aust.Visa application….I had to have a Fed.Police check to ensure I had no criminal record in Aust…..even though I had one to get my Visa to China in 2016 & haven`t been back since !….no common sense….just Legislation !
My solution when I access my PSS at age 57 in 9 months time, buy or build a tiny house on wheels have it placed in one of the new emerging tiny house communities that are just popping up now. Brisbane, ulladulla, Canberra (in pipeline) etc. Cost approx $35,000 for land plus $75 a week for water, electricity and sewerage, the value of the property is so far under the government’s threshold value of $350,000 so capital gains tax issue under new/proposed new legislation no longer an issue for non-residents. Rent it out as an airbnb at a premium, legally for 28 days a year as it is a niche market and classed as a caravan (it pays for itself in 14 years) all acceptable to tax office and local council etc. and then let family members stay rest of the time. Move overseas on a regular back and forth basis (purchase ticket overseas it’s cheaper) then you can choose to be a foreign resident or have the luxury of cheap living in Australia for 183 days pay less tax and be a resident in Australia for tax purposes and save a few scheckles and spend more money when overseas for the remainder of the year. Most of all enjoy the best overseas can give you. For those who have disposable income invest in share market and take advantage of reduced tax as a non resident. You work it so you always come out ahead each year. Plus convert an LDV hi top into a camper they are cheap and very live able (plenty of good examples on YouTube) avoid tax on camper vans worth over $100,000 that the Queensland government wants to slug the Grey army. This means you can stealth camp around Australia in your free time, it gives you so much freedom. My other fun hobby is my blue water cruising yacht that cost me $10,000 and sits in Botany Bay that costs $3,500 a year all up to moor, run and maintain and is great for living on with access to some of the best waterways in the world.
A combined Australia/Thailand base would be ideal for some Michael. I have a number of readers who spend time in both places and that would help with the residency situation.
I cut all ties with Australia when I moved here and don’t have a budget sufficient to run bases in both countries. I have to say personally that having moved from Australia I have absolutely no desire to return. I love my life here and I don’t miss the pluses of Australia, and there are plenty of them, enough to [pull me back even for a visit. I don’t have kids of my own and I think that makes a difference as well. Luckily most of the people I care for seem to be happy to visit us here in Isaan on a regular basis, which is a delight.
I do believe it is ridiculous for citizens of Australia to have to go through residency hoops to get the same tax treatment as others. I have no problems with non-citizens or people that have only lived in the country a short time being hit harder. But for someone like myself who lived and worked there for most of a lifetime it seems a very odd and discriminatory situation. Oh well. It is as it is.
Thanks for your contribution to the blog.
Best regards.
Tony
Unfortunately Tony we get caught in the cross hairs, i.e. we say we are going to Thailand to retire and they say, well good luck to you, oh and by the way, if you have a property here in Australia we are going to tax you 32.5c in every $ till you are forced to sell it because you will also forfeit the $18,200 threshold, and come 1 July 2019 if we get our way passing this latest bill through parliament we will charge you non residents capital gains tax all the way back to the day you purchased your property.
https://www.pwc.com/gx/en/services/people-organisation/publications/assets/pwc-australia-cgt-exemption-for-homes-of-foreign-residents-removed.pdf
We will also take away Medicare, your voting rights, and make you return and wait for two (2) years before you can have your aged pension made portable if you qualify, and if we are satisfied that you intend to remain in Australia for good.
One the other hand, if you want to work and pay taxes in another country while also paying tax to Australia, we can look at you as being an Australian resident for tax purposes because you are contributing to our economy, but it will be on an individual basis system, you know, what’s in it for us, do we come out on top without ruffling your feathers.
When I started writing I said “unfortunately” well that’s because too many people move overseas and work and don’t pay tax on their worldwide income back to Australia, so they have to take it out on someone, and those of us that do not contribute because we are retired, get caught up in the cross hairs, yes it’s an unfair system, but we make what we can of it and keep enjoying our retirement, because that is what it’s all about.
All true Angelo. It only annoys me at tax time and I just get on with enjoying a wonderful life in Thailand the rest of the time. I can’t do anything about it so despite its unfairness I put it under the ‘life’s too short’ rule for my attention time.
As always thank you for a thoughtful comment.
I know exactly what you mean Tony, the way I overcome the unfairness is, I fill in what I have to and let my accountant do the rest, last year I paid $5,000AUD in taxes for consultancy work I did for some old clients, better something in my pocket than nothing in my pocket and when I weigh up that I don’t have to pay any tax for shares I hold, I am miles ahead. Sure it irks me when I hear blokes like you and who have spent 40 years or more paying taxes get treated like 2nd hand citizens unless we are a Australian residents, well we didn’t make up the rules that make us non residents because we don’t have an address or property to anker us down to Australia, that said, life in Thailand is worth the tax that we pay to the Australian government to live the life they can only imagine, one life mate, live it and don’t look back, excuse the French, but the can go and get farked 🙂
Hey Michael your plan sounds, well, just like a plan and I hope it all works out for you. Just so you know, residency is not solely based on the 183 days rule. But if your in Australia for 183 days of a financial year, you could be deemed an Australian resident for tax purposes.
Thanks Angelo. I have friends who spend half their time in Penang, Malaysia. The rent an apartment for 12 months to get really cheap rates and working with the estate agent they sub let it when they go back to Canberra so they only have to pay for the time they stay there. Plus they fly in to KL only and transit overland to Penang and as immigration keep a tight check on flights arriving in Penang to catch out people they suspect of retiring in Malaysia without the appropriate retirement visa and purchase/investment in Malaysia.
Cheers Michael
Re.Ausie.Dept.of ha ha ha Human Services (Centerlink)
…when I informed them I had remarried in China in 2016 they immediately reduced my aged pension by $400/mth…plus another $40/mth.as they claimed I had been overpaid & it had to be repaid….my wife`s Chinese pension is only about a quarter of mine…but that didn`t matter..they won`t even correspond by email as they claim it`s not secure yet Dept.of Immigration & “Border Security” ask you to use email as it`s quicker….they can`t get on the same page..we thought about retiring in Thailand but after living in Chiang Mai for a year,& my wife wanting to get Aus.passport,decided no….also the increasing traffic,pollution,population & corruption,put me right off…..it costs over $7,000 Aud.to apply for an Aust.Visa…thankfully paid for by my wife`s daughter in Canada.(married to a Pom.).they`re making it harder all the time….everything considered….I much prefer Aus.
…I`m a no nonsense 80yr.old whose philosophy is “practice CONTENTMENT & contemplate ETERNITY”(you take nothing with you when you go) & luckily my wonderful wife….raised under Chairman Mao`s rule…doesn`t desire any fancy trappings…in food,clothing or housing….I own my ex Govt.house in Aus.with many bearing fruit trees & vines I`ve planted,plus vegie.beds & solar power & hot water.. also..the clean air & drinking water can`t be beat…as is democracy…you can criticize the Govt.& not go to Jail.
I believe ALL religions are only a crutch to help us get through life & usually to control the masses…gaining power & wealth for the founders…ALL male I believe…I`m spiritual,believe in Evolution,but of course,wonder….the Universe is beyond our comprehension…no beginning…no end….all for what ?….hmmmm.
Bit different to the usual input…but so be it….thanks for the platform Tony.
Thanks Angelo, good tip on getting a property valuation before departing long term overseas.
Hope you’re right that the new legislation has no hope of passing, but nothing would surprise me about the Aust Govt’s treatment of expats.
Your welcome Richard, I have attached a link for you and others maybe living overseas as non residents, it discusses the recent change to the 6 year rule and its grandfathering for anyone that is using the 6 year rule, like I said, the loop holes are getting tighter.
https://www.bdo.com.au/en-au/insights/tax/articles/foreign-residents-and-cgt
Please be advised this is general information and anything to do with holding or selling an asset should be discussed with a qualified accountant, or satisfy yourself through your own research, I say this because I am not qualified in this area and legislation keeps changing to catch us ducks who enjoy sitting on the pond enjoying life in Thailand
Thanks for that, unlike you I’m not living in Thailand yet, but you’ve given me some very important information should I decide to move there.
I had been looking for this link, its the legislation that actually spells out the difference or how the legislation differentiates the between a resident and a non resident. Although lengthy, well worth the read, in particular numbers 10,11 and 12 sum it up.
So recommend all read it for there own piece of mind to plan and get around things.
10. In determining a person’s domicile for the purposes of the definition of “resident” in subsection 6(1), it is necessary to consider the person’s intention as to the country in which he or she is to make his or her home indefinitely. Thus, a person with an Australian domicile but living outside Australia will retain that domicile if he or she intends to return to Australia on a clearly foreseen and reasonably anticipated contingency e.g., the end of his or her employment. On the other hand, if that person has in mind only a vague possibility of returning to Australia, such as making a fortune (a modern example might be winning a football pool) or some sentiment about dying in the land of his or her forebears, such a state of mind is consistent with the intention required by law to acquire a domicile of choice in the foreign country – see In the Estate of Fuld (No. 3)(1968) p. 675 per Scarman J at pp. 684-685 and Buswell v. I.R.C (1974) 2 All E.R. 520 at p. 526.
“Permanent place of abode”
11. Having established that a person has his or her domicile in Australia, subparagraph (a)(i) of the definition of “resident” requires the Commissioner to be satisfied that the person’s “permanent place of abode” is not outside Australia.
“Place of abode”
12. The expression “place of abode” refers to a person’s residence, where one lives with one’s family and sleeps at night (R v. Hammond (1852) 117 E.R. 1477 at p. 1488; Levene v. I.R.C.(1928) A.C.217 and I.R.C. v. Lysaght (1928) A.C.234). In essence, a person’s “place of abode” is that person’s dwelling place or the physical surroundings in which a person lives.
“Permanent”
The link is below, pleasant reading.
http://www.austlii.edu.au/cgi-bin/sinodisp/au/other/rulings/ato/ATOITR/1991/itr1991-2650/itr1991-2650.html?stem=0&synonyms=0&query=overseas%20abode
Some spectacularly convoluted logic. The ATO seems to be admitting that it doesn’t understand its own legislation!
Para 26 is interesting, especially the part stating that even if you just keep moving from suburb to suburb in the one overseas city, you’d still be an Aust resident for tax purposes. So, for example, you could keep renting different places in different areas of Bangkok for many years, moving every 6 months. Even better, if you don’t mind living out of a suitcase, occasionally mix this up with stays in other countries. As long as you don’t purchase a condo or stay too long in the one apartment, you’re OK. However, this seems to contradict paras 10 to 12.
I’m not advising anyone to try this though!
Absolutely agree with you there Richard, but just remember, 26 goes hand in hand with 23 and that in a nutshell, sums it up, and I would say that the onus is on you to actually prove that you are a resident of Australia.
In weighing up things before I became a non resident, I did the calculations and what benefits I would have by becoming a non resident, as much as I found that it was insulting, e.g. born and bred in Sydney, paid taxes for 40 years and capital gains tax at least half a dozen times.
It did not pay me to hold onto my residence so they could tax me a flat rate of 32.5c in the $ and hit me with capital gains tax from the date I left.
They took away my voting rights, I have to return to Australia 2 years before I reach the old pension age and wait for 2 years before I can go abroad and take it with me, and Medicare will go eventually, so what have I learnt, well, the government who brought this legislation in is stupid, seriously, I invested my money from the sale of the property into the Australian stock market and have been earning around 10%-15% net per year and pay no tax on fully franked dividends and no capital gains tax on shares I buy and sell.
I can understand that they want to discourage us from getting the pension and moving overseas, as they say the pension was intended to be spent in Australia, well perhaps they should make the cost of living less and more xpats would return.
If the government didn’t treat its Australian Citizens as non residents, then perhaps they would be getting the slice of the pie, but their choice, and it suites me down to the ground, because I am living like a King on my return from the stock market, and can return at any time and reestablish my residency…lol
I have a CSS pension and live in Thailand. I’ve also studied the Tax Treaty at length and disagree with the opinion expressed above. I’ve had 3 separate Tax Accountants tell me I am a non resident for tax purposes. I’ve also read the old court ruling that decided we were non residents.
However, I did note a change to the resident tax calculator a while back to include questions about gov. pensioners. If answered in certain ways it now advises to contact ATO. I know of 2 of us who did this, and, when they affirmed they were CSS pensioners, received Oral Rulings that they are residents. It seems there is policy overruling the regs and the court case.
Sorry for the late reply Terry. I have been in hospital for minor surgery so out of action on the blog.
I agree with you at this stage. Everything I have read points to the fact that once you move to permanently reside overseas we become non-residents and there’s no loopholes in the published rulings. I am interested in your point about government pensioners (CSS/PSS) and that could be worth following up in my case but not much help unfortunately for others. My concern would be in receiving an oral ruling only to have it overturned formally sometime down the track and then being hit with back tax – something I couldn’t cope with financially.
I suspect the only option is to get a tax accountant (a real one not the so called experts who wrote a couple of comments in this post topic) to get a formal ruling. The points I have picked out of all of these comments that are appropriate as a basis for such a review specifically relating to my situation are (1) I receive a PSS pension (2) No permanent resident status is available in Thailand – annual visa extensions only and (3) We are unable to own a property in Thailand.
This post has generated a lot of interest so we may learn more as new comments flow in.
Thanks for your contribution.
Tony
Hi Tony, this one is in response to Terry and his accountants advising him that he is a non resident.
The link below is a great read if you or others have not read it, its actually the legislation.
I have summed up points 10, 11 and 12 to narrow it down. The link is at the very bottom, if you can convey this to Terry, it may answer his question, which I am not sure of, bit if it is to do with the pension and being taxed, my understanding is you are not taxed on your pension as a foreign or non resident, but don’t think that would have been the question. Sorry for budding in.
10. In determining a person’s domicile for the purposes of the definition of “resident” in subsection 6(1), it is necessary to consider the person’s intention as to the country in which he or she is to make his or her home indefinitely. Thus, a person with an Australian domicile but living outside Australia will retain that domicile if he or she intends to return to Australia on a clearly foreseen and reasonably anticipated contingency e.g., the end of his or her employment. On the other hand, if that person has in mind only a vague possibility of returning to Australia, such as making a fortune (a modern example might be winning a football pool) or some sentiment about dying in the land of his or her forebears, such a state of mind is consistent with the intention required by law to acquire a domicile of choice in the foreign country – see In the Estate of Fuld (No. 3)(1968) p. 675 per Scarman J at pp. 684-685 and Buswell v. I.R.C (1974) 2 All E.R. 520 at p. 526.
“Permanent place of abode”
11. Having established that a person has his or her domicile in Australia, subparagraph (a)(i) of the definition of “resident” requires the Commissioner to be satisfied that the person’s “permanent place of abode” is not outside Australia.
“Place of abode”
12. The expression “place of abode” refers to a person’s residence, where one lives with one’s family and sleeps at night (R v. Hammond (1852) 117 E.R. 1477 at p. 1488; Levene v. I.R.C.(1928) A.C.217 and I.R.C. v. Lysaght (1928) A.C.234). In essence, a person’s “place of abode” is that person’s dwelling place or the physical surroundings in which a person lives.
“Permanent”
http://www.austlii.edu.au/cgi-bin/sinodisp/au/other/rulings/ato/ATOITR/1991/itr1991-2650/itr1991-2650.html?stem=0&synonyms=0&query=overseas%20abode
Angelo. You are a champion among expats! I doubt that many people have gone into the detail you have, me included, on the regulations behind the non-resident classification as you have. Invaluable reference material for anyone planning to fall into that category.
I have stated it before and your additional work seems to re-establish the fact that if you take a blinkered approach to declaring yourself as a resident tax-wise if you have permanently moved overseas then you may indeed get away with it for your lifetime and there seems to be some who are taking that approach. All light and happiness in that situation. If however the ATO decide to crack down on this area of the tax code and start to do audits, as we know they are inclined to do, then the resulting outcome involving back taxes owed and fees applied could ruin a lifetime’s planning for retirement in comfort.
I have seen nothing yet that encourages me to change my non-resident status back to resident and hope for the best. I am the poorer for it but I sleep well at night.
I won’t repeat my feelings about the unfairness of this approach targeting retirees, while the top companies local or foreign owned pay no tax, as I have said it all before.
Angelo for anyone looking at the financial aspects of retiring to a place like Thailand this post provides them a chance to be more informed, gives them the questions they need to be asking their tax advisor and whatever their choice on declaring residency it will be based on an understanding of the risks involved. Thank you again and also to the many others who have contributed to this discussion.
Hey Tony your more than welcome mate, and I am of the same belief as yourself, be straight up, and sleep well at night.
I did some consultancy work online last financial year, although I am retired, I took it on for some established clients and some referred clients, having said that, I just did my tax return and of course I am going to have to pay 32.5c in the $, but hey, if you try and turn a blind eye or lie, like you said a simple audit, i.e of my bank account for example and I am toast, and the ATO fines are very very heavy and once you have been caught, the will be watching your return every year, so I will gladly give them the $6,000 as I say to myself, well, I didn’t pay any tax on my share portfolio, and therefore its a win/win situation.
Totally understand your gripe about the companies not paying taxes and learned a long time ago, there is nothing we can do about it, because the boys in the private club makes this happen for them, wonder why $$$$ ?, maybe, but we have to learn to keep researching and play their game and make it work for us, if we are fortunate enough.
Cheers
Tony can I enquire what you are paying tax on as a non resident, i.e. do you have a property back in Australia that is receiving an income and you are paying tax as a non resident accordingly. The reason I ask, is that sometimes a solution might be in front of you, but you can not see it and then someone just happens to say did you know of A, B or C and pulls a rabbit out of a hat, not saying that’s the case, but I am willing to give it a go, if you like.
Sorry Angleo. I missed your reply.
I sold my house before I came here and I only have the PSS pension income. I have some capital sitting in super for emergencies but not a huge amount.
Unless the ATO have some special relationship with ex-public servants living in Thailand I am not sure what options are available.
You will quickly become my best friend if you come up with something 🙂
Cheers. Tony
Hi Tony
No problem, this is a totally new area for me, but having had a quick read up, link attached, it appears I cannot offer you any light on your current situation.
If I am correct, it would appear that you are deemed a non resident because you live here, you receive a pension from the Public Superannuation Scheme having preciously worked for the government and they are taxing you on what you receive at non resident rates, (nice), I wonder if this applies to the normal pension paid to xpats living overseas as non residents, like I said, this is a new area for me ?
https://www.ato.gov.au/law/view/document?docid=AID/AID20021064/00001&PiT=20140620000001
If the above is correct, I would suggest and perhaps recommend that you seriously look at a scheme to stick it right back at them, i.e. if its feasible and you have grown kids in Australia, return to Australia, use their address as your residential address, keep a bank account open if you still have one, or open one, Medicare card, club memberships, drivers licence etc etc so as to show that you still maintain residency with Australia, and pay tax rates as an Australian tax payer if there is any tax payable on this pension (which I would doubt), like I said I am new to this area ?
Once you have established residency, get back over here and start enjoying a tax free life, you earned it, I mean you didn’t rock up on a boat as a refugee and receive hands outs later to be found dealing in the drug ice, you passed being on unemployment benefits because it wasn’t you.
I’m all worked up over this, I mean, you work all your life to retire, get a pension and move overseas to get taxed, not what you, I, or anyone else wants to hear, so please revisit the above and let them sort it, if you are ever audited, you can state that you are a resident of Australia and intend on returning in 2025 and for them to FO, totally un-Australian what they are doing, I will allow you to work out the translation on that.
On the other hand, as far as I know Superannuation is not taxed as a lump sum when you turn 60 whether you are a resident or not, and am looking forward to taking out mine in a 2 and a half years and paying no tax.
As for selling the house, yes been there, did that, and as you know the only way around paying tax on that money is to invest it into the Australian Share Market buying fully franked shares, if yo haven’t got a broker, suggest you get one, and start earning a coin, mine has been brilliant, and looks after me, he is not all about commission and taking risks, he earns his keep and keeps an eye out for me best he can, I also contribute from my early learning and am very very satisfied with my decision to go down this path, even with market fluctuations, but if your in with the big ones, i.e. blue chips, who are also paying good dividends of 6%-7% net, plus take profit on stocks regularly that are not paying dividends but provide you with a good capital gain in the short term, capital gains tax free, you cannot complain about that.
If you need a leg up with a contact if your not in that field, let me know, but as I always say to everyone, you have to be involved, not just allow someone to take control of your funds, i.e. you decide when to buy and when to sell, and how much to invest on each share at each time, last thing you want is pressure, guidance on the other hand serves us all better.
I would be interested if you could give me a leg up on pensions and superannuation lump sum payment if your up to speed, or confirm what I have heard.
All the best
Obviously my research on the subject covered the provisions relating to residence, abode and permanency. It is from where I would mount a defense if, in the unlikely event, I was audited and received a negative ruling. For instance a migrant visa is specifically mentioned as a factor in deciding against the taxpayer. As we are constantly aware, in Thailand there is no such thing, we are here temporarily, for 12 months at a time, and could be shunted out at any time. Also, the ban on foreign ownership of land means few of us have such ties here. It would be quite easy to establish that we have no permanent place of abode.
In regard to Oral Rulings they do have some weight.
“An oral ruling is a form of legally binding advice we give over the phone to taxpayers who are individuals.
If you rely on an oral ruling given to you, we are bound to assess your liability under the ruling.”
I would advise you try for such a ruling Tony, before just paying the 32.5%
I also think that, considering Tax assessors, members of tribunals and legislators (pollies) are all going to be government superannuation pensioners one day, and may wish to reside overseas themselves, I doubt hard interpretations would be made for commonwealth superannuates..
Thank you for your words of encouragement Terry. I do intend to take this matter further and test the waters. I personally agree with your points and the last sentence made me laugh – in an agreeing way 🙂 Thanks for your “oral ruling” advice. Most helpful. That would be the easiest first line of enquiry wouldn’t it.
You have been a very positive contributor and it is much appreciated. I will report back on progress.
Tony
Hello again Tony in Thailand
There’s an article in today’s Canberra Times (search for “Aussie expats becoming potential collateral tax damage”) that raises another issue that could cost some people a huge sum of money.
New legislation is apparently being introduced that would remove the capital gains tax exemption for the family home that an expat owns in Australia. Imagine – after owning a home for 40 years in Australia, you then live overseas as a non resident for tax purposes for a couple of years, then sell the home in Australia. The entire increase in the value of the home over the 42 years is then liable for capital gains tax, not just the increase in the home’s value in the 2 years you’ve been living overseas.
I don’t think that the legislation’s been passed yet, the article doesn’t make that completely clear, but anyone contemplating keeping their Australian property for a time while living overseas should be very careful.
That’s been on the cards for a while mate, but cannot see that getting through. Currently if you rent your principal place of residence PPOR out, and reside overseas as a non resident, your capital gains tax liability will commence from the date you departed, i.e. if you go over the 183 days in any financial year.
If I am correct, from 1 July 2019 they are also doing away with the 6 year rule, which would allow you to rent out your PPOR while overseas, or working interstate etc etc, so they are tightening the noose every which way they can.
But I could not see them charging capital gains tax from the date of purchase if you have lived in it for 40 of the 42 years, just more time wasting in parliament from the idiots that try and fry us for getting out of the production line and realising that there is an actual life abroad, and a very relaxed and affordable one, so if we are not contributing to the system, they will try and do damage to us, hence all the penalties in place at the moment, so if your a non resident, it doesn’t pay to hold onto property, if you are, you MUST get a valuation carried out by a qualified property valuer as at the date you left the country, and hopefully as high as possible to minimise your future capital gains tax liability.
If you sell it, get some professional advise and invest it in the stock market, as there is no tax payable on fully franked shares, and no capital gains tax payable, so why pay 32.5c in the $ tax on your rent as a non resident, plus capital gains tax when you sell, property in Australia is for Australian’s, not for non residents, just need to adjust your thoughts on how things work best for you and start earning money tax free, I did, and its all legal.
An entire lengthy “investigation” and lots of comments, none of which contain a single mention of the Thailand-Australia Tax Treaty, which like all such treaties over-rides the Tax Act!! Under that treaty you’re either tax resident in Australia or in Thailand, possibly both, but definitely one or the other. There are rules on determining where you are tax resident but the general principle is “where’s the money?”. If your sole source of income is one country then that’s where you are tax resident. If you have a source of income in each country then there are rules which apply to determine tax residence. Finally if you’re still confused there’s a “tie-breaker” (sorry about the pun) – it’s where you are a citizen. So all of this drama is a storm in a tea cup – you’re tax resident in Australia if that’s your sole source of income, and in particular if you’re a citizen
I’m a tax accountant by the way
Thanks for your comment. I wonder if the Thailand-Australia Tax Treaty has any relevance to this discussion and maybe you can enlighten me on that in a further comment. There is no dispute that someone like myself who is drawing a superannuation pension from Australian sources is a tax resident of Austalia. The question is at what rate is that income taxed. Under the ATO rules I provided in my post there seems to be a two tier assessment. ONE – are you a tax resident of Australia (Yes in my case) and TWO – are you an actual resident of Australia i.e. is this where you live? The non-resident (home base) aspect seems to affect the rate applied and that’s where the first topic in my post took issue.
Are you saying that there is only one criteria the ATO uses and that is the “tax resident” aspect and the country where one lives has no relevance to their application of a non-resident penalty. I would like to think so but the ATO website doesn’t seem to support that. They ask questions (listed in my post) that determine not whether you are a tax resident but whether you are a foreign resident. The two seem to be linked but separate criteria.
I also point you to the ATO ruling on a PSS pensioner who challenged his non-resident status being:
Issue
Is a taxpayer who is in receipt of an Australian Government superannuation pension and living overseas, a ‘resident’ as defined in subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936)?
Decision
No. A taxpayer who is in receipt of an Australian Government superannuation pension and living overseas, is not a resident as defined in subsection 6(1) of the ITAA 1936 as they do not pass the superannuation tests.
If the non-resident assessment overrides the tax resident criteria then we are back to square one with no tax free threshold and a 32.5% tax rate from dollar one!
I would be super happy to be proved wrong but on the information you provided in your comment I am not convinced. Thank you again for your contribution and I hope to hear more.
Tony
You have my attention being a “tax accountant”, however as I reside in Thailand on a spouse extension, i.e. they are not referred to as visa’s, however are referred to as annual extensions, or permission to stay for another year, how can I be considered to be a tax resident of Thailand, having said that, my income is sourced from Australia via the Australian Stock Exchange ASX and the ATO advises that foreign residents are not taxed on fully franked shares and no capital gains tax is payable for shares bought and sold as a non resident, so how can I be a resident of Australia, if my “Abode” is here in Thailand.
I have read and researched this and the legislation and also ran all of this by my tax accountant of 32 years prior to moving to Thailand, and everything pointed me in the direction of being a foreign resident and that is how it is, however I am open to your statement being proven via a link to refer to too, because the evidence that I have read/sighted is overwhelming, but like I said, I am open to any information that can prove this to be any different.
I agree with you at this stage Angelo. I am waiting for a response from the “tax accountant” as well but see no evidence that people like us can be classified as other than a non-resident.
Tony
Cheers Tony
Great post, Tony, on unconscionable legislation that prevented me from retiring to Thailand 5 years ago. Like you I’m on a modest PSS pension. Here’s where it gets technical – PSS pensions are divided into 3 parts, and if you’re an Australian resident for tax purposes aged over 60 the parts are taxed as follows –
Tax free component – zero tax payable
Taxable taxed component – taxed at 0%
Taxable untaxed component – taxed at normal rates including tax free threshold, less 10% tax offset
You say that you’ve declared yourself to be a non resident of Australia for tax purposes, so do you pay 32.5% tax on your entire PSS pension, or just 32.5% on the taxable untaxed component less the 10% offset?
If I were to become a non resident for tax purposes, it would be the difference between paying $12,700 or $6,000 in tax. I’ve found no answer to this after thorough searches of both the PSS and ATO websites.
Thanks, other entries in your blog look very interesting too.
Thanks very much for your comment, which helps expand the knowledge base on this topic.
No I don’t pay 32.5% on my entire income from the PSS. I have the components you raise and pay tax on the untaxed component. I wasn’t a public servant for that long (17 years) so the untaxed component in my case is a larger component than it would be for a “lifer”!
My tax is lodged by an accountant and your comment has inspired me to revisit the last return and double check the figures as it is a little outside the norm.
Thanks again.
Thanks so much for your reply, Tony. You’ve given me the first real information I’ve been able to find on this topic, and have inspired me to at least think about moving to Thailand again…
Best of luck with your tax return.
Thank you Richard. I will be following up on a couple of issues raised in this discussion and I’ll report back on anything interesting I discover.
We had a couple of “experts” reply but as neither of them have bothered to respond to my additional questions to them I suspect they might just be Pattaya bar-huggers out to cause mischief. I posted this topic on ThaiVisa, which has a lot of thoughtful and responsible readers but also a lot of the very worst types of farang that should be sent home to their own countries to cause problems there rather than clutter up Thailand.
Cheers.
Hi Tony a very interesting blog, but can I say one thing as an Aussie xpat, its not all that depressing if you stumbled onto the research I have, i.e. you can avoid paying tax if you invest your money in the ASX, I don’t know if you or the other readers here know this, you can se
ll your property that is providing you with an income less 32c in the dollar to the tax man, plus less maintenance costs, water, council rates, insurances, vacancy factors, agents fees and agents re-letting fees, advertising costs etc etc, then you have capital gains tax, but not before you get a retrospective fair market valuation as at the date you left the country, hopefully the valuer will give you a higher figure to minimise your future liability.
I mean seriously who wants to hang onto a property, by the time you add the above its a 50/50 split, however if you invested into a low risk portfolio in the ASX through a good broker you could be earning 5%-6% net yearly, and very easily, all tax free, i.e. you by fully franked shares (tax paid at the time the dividend is paid), problem solved and any capital gains tax is yours because there is non to be paid, sound to good to be true, well its true and legal, I have been doing it and there is no problem, and sure, shares rise and fall, but if your not selling when they are down, your good, I sell when I want to take profit, and I also get involved in my portfolio, and in 6 months I was managing 7.5% net, that’s 15% per annum tax free with a low risk portfolio, so worth looking into as a foreign resident.
I am responding to this blog through your posting on TVF
I do not know if it is still there, but the ATO used to have a case example of tax residency on its website where somebody wanted to live in Kenya (!!!) but could only get a short term visa not permanent residency. In that example the ATO said they were still an Australian tax resident. As very few of us have (legal) permanent residency here I would think the same applies to us. We are all only guests here, temporary alien visitors.
Another criteria is making a permanent home … unless you buy a condo you do not have a “permanent” home here in your name, even a usufruct is still just a lease by a fancy name. So under that criteria you should not be ruled as a foreign resident either. That’s the view of my tax advisor who has quite a few clients living and working in SEA, so I hope he is right!
Most of my income is from franked dividends so that would not be affected but I do receive a military pension of around 16500 dollars that comes in under the tax free threshold. If I was declared a foreign resident it would cost me around $5000/year, or 10000 baht a month. That would hurt !!!
The number crunchers in the govt really should work out that even if they get a few extra dollars from us expats via the ATO other govt departments save much more by us being overseas….no or reduced pensions, no subsidized health or housing or other seniors discounts, less pressure on the health care system, etc etc.
They worry about an aging society and the problems it may bring so they should be encouraging us to stay here not potentially penalize people.
Thanks for that useful addition to the topic Mike. Your situation matches one that I reported on my Facebook page in reply to a comment being:
I am very interested to hear that your tax advisor feels that the temporary visa and non-residential ownership status of westerners in Thailand makes us back a “default” resident of Australia. I might write to you privately and get his contact details if you don’t mind sharing. I have a friend who is seeing his tax advisor tomorrow prior to a final move to Thailand so I will make sure he sees your comment.
I totally agree on the non-logic of trapping aging Australians in the country through tax and pension restrictions. It makes no sense whatsoever.
Cheers.
Tony
Hello Mike. It is not my experience (2000-2003 and 1968-1988) that non-resident Australians can receive any benefit from Franking Credits. A Withholding tax was deducted at source and not reclaimable. Andrew
Thank you Andrew. I meant to question that aspect based on your previous advice.
Andrew. What l meant was that it does not make any difference to the total amount.
From the ATO website:
If you are a non-resident of Australia, the franked amount of dividends you are paid or credited are exempt from Australian income and withholding taxes. The unfranked amount will be subject to withholding tax.
Franking credits are from the 30% company tax already paid, which is the same as withholding tax, so effectively it does not make any difference (if they are fully franked dividends) should you become a non resident for tax purposes. A company pays a dividend of one dollar, fully franked…..70 cents to a tax resident and 30 cents goes to the taxman on your behalf. Or one dollar minus withholding tax of 30% for a non resident. It’s the principle of no double taxation. There is talk about reducing company tax which should logically mean reducing the value of franking credits, but that would be politically difficult and might mean a backlash from self funded retiree voters !
Hi Tony. As an addition to my comments on Age Pension payments while overseas for more than 6 weeks, I also visited the website, https://thaiconsulatesydney.org.en and became aware of a 5 year visa available if you can meet the Thai criteria for such a visa.
You and your regular readers of your blog may already be aware of this?
It was something new for me.
Thank you and keep going with your very informative blog.
It did get some publicity locally. I don’t know why it has taken so long for the Thais to wake up to the fact that financially comfortable farang can make a very positive contribution to their economy. I am very small time but have spent 3 million on property, 1 million on a pick-up truck and spend more in a month on upkeep than many Thais would in three months. Things like the 90 day reporting for those of us on OA (retirement) visas, which only inconvenience both sides with absolutely no benefit to anyone should be scrapped. Overall I have to say that the visa requirements are not that bad – much preferable to Australia.
Hi Tony. I have corresponded with you via email in recent times. After reading this latest article, I would like to comment on the Age Pension while living temporarily overseas. Next year, I will be eligible for the full rate Age Pension and a Pensioner Concession Card, as I was born in Australia. I own my home and my assets are under the threshold to qualify for the maximum rate. Currently the maximum rate is $894.40 per fortnight. This comprises the maximum Basic Pension rate of $814.00 plus the maximum Pension Supplement of $66.30 plus the Energy Supplement of $14.10. You can be paid the maximum Pension rate up to 6 weeks living temporarily overseas. If you stay longer than 6 weeks overseas, temporarily, your Pension supplement reduces to the minimum rate of $35.70 and you lose your Energy supplement of $14.10
So the total reduction after over 6 weeks overseas is $44.70 per fortnight. The total Pension rate at this time for a person like me is $849.70 per fortnight. After speaking to the Human Services Department (Centrelink), this can also be confirmed on the website, http://www.humanservices.gov.au, I can go overseas for up to 6 weeks, as many times as I like and I will still receive the maximum rate of Pension, as long as I don’t overstay that 6 weeks.
After talking with Centrelink and also my Local Council and Utility suppliers, like Telstra, Electricity and Water and even Roads and Maritime Services for Car registration, I found out a little known issue, at least one that I was not aware of.
If, you are the holder of a Pension Concession Card, you receive rebates for the above services or even pay nothing for car registration, you still pay full rates for third party and comprehensive car insurance.
After you live or stay for a holiday for more than 6 weeks overseas, when these Authorities do their check with Centrelink for your continued eligibility to receive these rebates, you will not be entitled to a reduction, if you are overseas for more than six weeks. The only way to ensure you receive maximum advantage to these rebates, is don’t go overseas for more than 6 weeks at a time.
People arrive into Australia illegally and they give them the “keys to the city” and People born here or Australian Citizens and wishing a better life in places like Thailand for their retirement, are penalised by rules and regulations and discrimatory legislation.
In my own situation, if I sell my house and therefore increase my assets, rules and eligibility for the Age Pension and everything else, changes.
I would like to hear if any one on this blog, has been affected by this?
Thank you Tony, for your blog. Very informative.
This topic becomes increasingly depressing the more comments that come in. What is the attraction of using the taxation and social security systems to trap retiring Australians in their own country? I just can’t fathom the logic behind it. It’s not as if there is a financial disadvantage to the government in allowing us access to the same net income we would have if we stayed home. As I have written before they lose our contribution to GST (Good and Services Tax for non-Aussies), but as we usually have a more limited income a greater percentage will be spent on non_GST expenditure such as food. This revenue loss would be more than made up by a reduced demand on healthcare and other infrastructure costs.
Thank you for adding some very useful additional information to this discussion Stanley.
Tony
Hi Tony,
Thanks for the prompt response.
I live with a lady who teaches at a government school here in Nongbua Lamphu. If you are in “the big city,” I could meet with you any weekday between February 19 and March 8, since I return to the USA on March 10. On the remaining weekends I will travel a bit with my partner, since we have limited time together before I depart.
On weekdays when my partner is teaching, I go almost every day to Tesco Lotus, markets, and other stores to chat with both farang and Thais who have a bit of English. I only know a few words and numbers in the Thai language, but I find that people here are fond of chatting with us as long as we make an attempt to speak a bit of Thai.
You can give me any time and date at my yahoo email address and I would be happy to meet you and share a few stories. If we are unable to meet before I leave, perhaps we can get together when I return to Thailand this summer Again, thanks for the good work you do with your blog, and enjoy the rest of the weekend.
David
Nice one Tony. Very informative. I am also researching options for living in Thailand (although not permanently).
The ATO rules are very complex with varying outcomes depending on individual circumstances. For people to make a ‘suck it up’ comment without even offering relevant ATO rulings on their individual circumstances allowing them to remain resident for tax purposes while residing overseas, are just trolls and should be ignored. If this person is deliberately misleading the ATO on his annual tax returns, he will be found out. I enjoyed reading your reply just as much as your article.
Cheers
Thanks for your positive feedback Graham.
Good luck with your half/half move to Thailand 🙂
Cheers.
Hello Tony,
I am an American and have been living about 7 months in Thailand and 5 months in the USA for the past 5 years. I received much valuable information from Don’s Life in Thailand, Don being an American who, unfortunately, passed away a few years ago. Your website reminds me of his, very good information to help citizens of your nation with interest in Thailand and generally with a very positive outlook.
This year I live in Nongbua Lamphu, which has been my favorite area so far, since the people are so friendly, the cost of living is low, and traffic is very light compared to larger cities. As you well know, we have Makro, Tesco Lotus, Global House, and other outlets that make living here very comfortable, should we want Western food and amenities. Proximity to Udon allows us to be close to a major city and international airport, while still enjoying a relaxed, small town atmosphere .
Again, thanks for the information you provide, and I hope you continue to enjoy life here in Isan.
David
Thank you for that very gracious comment David. We are, as you may know, just down the road from you at Si Bun Ruang, and I can agree with all your pluses for living in this area. We get the all the benefits of a small, mostly rural based environment but have all the infrastructure we need either locally or in Udon to live a comfortable farang life. I have friends that live in Udon and I wouldn’t exchange for anything. If you ever feel like being social (and some do and some don’t) then maybe we could meet up for a chat sometime. We are often in NBL.
Kind regards.
Tony
Tony, another great read. I am also receiving PSS and would be borderline for any old age pension benefits, which is nearly 12 years away for me. I never factored in receiving the OAP, not only for the two year rule but more what any “early” retiree should consider, that being the scope for legislative and regulatory changes to pensions. There is no doubt about it that the OAP in Australia has transformed in the last decade from being an expected right or entitlement into a welfare benefit. I can see that tightening up more so. I do believe most full OAP recipients in Thailand do deliberately or mistakenly declare themselves to be residents for tax purposes. At the moment there are many under the radar and I would hate to see what happens if they are later deemed non residents (through data matching on time away from Australia, or legislative change), combine that with the exchange rate and many will have a real dilema, I do maintain a modest residence in Australia, more to do with providing a home for my adult children than anything else. I return to Australia every ear for 2 or 3 weeks, and to be fair while not owning any propert here am still dubious that push comes to shove that I could pass the Residency test as it stands now, let alone if it tightens more. You would be more than aware of the high housing and rental costs to enter the market. Returning for 2 years in order to claim the OAP would see many without family or residences residing in shared or substandard accomodation, that would be soul destroying after living in Thailand. How would one look after a wife here (legal or village married) and still survive in Australia. Too me, anyone that is considering retiring overseas with sole income of a full OAP really is facing a struggle. The PSS defined benefit pension is an absolute God send that I am eternally grateful for, that’s for sure. The Residency for tax purposes issue is certainly one that curtails any definitive plans for me in Thailand, even after 8 years here!
Thanks very much Anthony for a thoughtful response with additional information that may be useful to others.
It seems sad to me that in applying pretty nonsensical regulations, to extract minor returns in an overall budgetary scheme of things, is mostly at the expense of the people who can least afford it. The majority of Australians selling up to retire to Thailand are not the hugely wealthy. They are little people like me who only want to maximise the comfort and enjoyment of their lifestyle post retirement.
Like you I wonder at the number of folk who either plan to “fool” the system or unknowingly expect to pay the same tax rate as back “home” (and why wouldn’t you!) that may get caught out at some stage. We aren’t the class of people who can take out another mortgage to repay debts or sell off excess shares! Repayments of tax with penalties could easily run into tens of thousands of dollars (the example I gave in the post shows a difference in tax payable of around $8,000 for one year), which would certainly bring my Thailand dream crashing down. Us oldies would then return to Australia to throw ourselves on the welfare system and create greater long term social and economic problems than we would ever achieve by living a peaceful life in Thailand with the same net income we would have if we live in Australia.
I have a little shrine set up for the PSS and pay my respects every day 🙂
Cheers.
Tony
Hi Tony, thanks very much for the information regarding retiring overseas. I’m 63 and I’ve been thinking quite a bit about retirement for a few years now. My wife is also Thai, and I’ve decided I would like to retire to Thailand. Only two weeks ago I went to Centrelink to discuss retirement options. I was told I could retire at 66, in 2 years and 8 months, and receive the old age pension depending on the assets test, I’m good there.I would need to apply for the pension 3 months before my 66 birthday. I must also be living in Australia when I apply. After I receive the pension then I can move overseas to live permanently and still get the pension. After being overseas for 3 months I would lose $28 of my pension which is an energy loading payment??
In order to receive the pension continuously while living overseas you must have been a permanent resident of Australia for at least 35 years or more.
I was born in Britain and emigrated to Australia in 1959 when I was 4 years old, so I qualify there ok.
I haven’t got a great deal in superannuation, being divorced once. I even made the silly mistake of putting in quite a bit extra in super each week so we would be comfortable in old age, bloody fool am I.
So I would use part super and the pension to live on in Thailand. We own our home in Australia and we would keep the home while I’m overseas as my step children would live in it, otherwise I would rent it out. I have 3 grown children of my own so I would come back to Australia at least every 1-2 years.
I can understand your frustration Tony, it’s as if the Australian Government is treating it’s older retired Australians as deserters of it’s country, even though we love our country, and paid taxes for all those years.
Your point about the exchange rate is a valid and important one, which needs serious consideration.
There it is, I could have gone on but I won’t, thanks for the opportunity to say something, regards Frank
Great to hear your story Frank. Thanks for sharing.
The main aim of government these days seems to be to throw as many roadblocks as possible in the way of what should be pretty straightforward administrative issues. Too many politicians with too much time on their hands wanted to be seen to be doing something. The country would probably run smoother if they all just turned up at parliament house and played Angry Birds on their iPads 🙂
I wish you every success with your move and the life that awaits you here. PLease keep in touch and let me know how you’re going if that sits OK with you.
Cheers.
Tony
Hi Frank, you are both living in Aust. when you apply for the pension so can receive it. Like Tony I will be living in Thailand years before pension age. So we have to live in Australia for 2 years after applying. Only permitted to go overseas 6 wks per year each of those years. Which is a big problem.
Cheers Ian
Great article as usual Tony,
As retirees from Aus, we have a few major problems.
The regulations, governing pensions, can and do change at a drop of a hat, at the whim of our unethical politicians, who by the way have just voted themselves an increase in their ‘remuneration and allowances’. But that is a whole subject for discussion.
To add to your warnings, I would like to pass on my experience:
After splitting from my wife of 33.3 years in 2013, I went to live in my house in the south of France until I was eligible for the age pension age 65, a period of 6 months. On my return and subsequent visit to Centrelink for the pension, a ‘bright’ official said, ‘Oh you arrived back into Australia yesterday,(yes, passport control and Centrelink are connected), ‘where have you been living?’ I said France, because I cannot afford to live in Australia without an income. His immediate reply, was, ‘you are a returning resident’. Little did I know the implication of that statement. Thankfully after two appeals I found a gentleman who could understand logic and overturned to decision.
So a word of advice to others, be very careful how the questions are framed to you. Don’t think by having an Aus address, they are not aware of when you leave the country.
Some bright politician brought up the idea of stopping to pay pensions to us overseas. He obviously has less that half a brain, because if 50% of pensioners returned to Aus and then had to be provided with social housing, where would that come from and at what cost?
To David Lee’s comment: Suck it up, Tony. Government retirement benefits are for those who retire in the country that’s paying them in my opinion. That Australia allows its pensioners to live abroad is a legacy of its extensive migration programme. I’ve lived all over the world for extensive periods of time but have always remained “resident” by virtue of answering “are you a resident of Australia?” on the annual income tax return which is now lodged electronically from wherever I happen to be in the world. My first question is, did you pay your tax in Australia while working overseas? If not, you should not be eligible for the pension, irrespective on the answer on your tax return. If the period of absence was more than 3 years continuously, because you have not contributed as Tony, many other Australians and I have. So mate pay your full wack for your insulin.
Cheers
Hi Brian.
Thanks for the positive feedback and added wisdom on this subject.
Always great to get your input to topics and know you’re still around taking an interest.
All the very best.
Tony
Draconian! I did get the impression, during the course of my last Australian visit, that Australians live in a ‘nanny’ state. It felt to me, as an outsider, that the Government is far better equipped to decide on the future of individuals, rather than the individuals themselves! I also gained the impression that, most aspects of life in Australia, are subject to some form of regulation. I hasten to add, that, I do not intend this comment to be construed as criticism of a jolly fine country! (Especially the outback around Alice Springs.) I simply convey an impression, that could be way off the mark.
Keep up the good work mate! I hope to meet up with you in the not TOO distant future.
Regards,
Jim
I feel it is Jim. You are spot on in your outsider’s observation of Austalia. We are increasingly becoming more and more regulated and controlled for our own benefit of course. The ability of government to treat adults as adults and for the individual to take on responsibility for outcomes is becoming a fading memory. I believe we end up with a weaker and more apathetic society as a result. So many have just lost interest in trying to change the system and instead go along with whatever is dished up by a distressingly poor leadership group – and that’s on a worldwide basis.
Thanks for your comment and we look forward to meeting for real one day.
Hi Jim interesting observation, but disagree with your statement, ‘as an outsider, that the Government is far better equipped to decide on the future of individuals, rather than the individuals themselves!’ I certainly don’t believe they are better equipped, but rather think they know better.
Sadly the notion of them doing the will of the people, was thrown out with the baby and the bathwater!They are only interested in their own benefits.
Forget about moving overseas.
Australia`s population reached 25 million last year.
1.25 million being Chinese.
sick thought…..Australia`s old “White Australia Policy”
There`s a CHINK in it`s armor !
I`m partly to blame….I`m married to a Chinese.
The most wonderful woman I`ve ever known !
Hi Clem. It’s been a while. Nice to hear from you. The chink in the armour is an expression that has now been added to my list 🙂
Tony
Hi Tony, l have a fiancé who lives in Surin and as her current fridge has just about packed it in l am hoping to buy a new fridge for her shortly. I definitely have the fridge u purchased as my number one favourite model. Just wondering if u are still happy with it and if it needs to be connected to a water supply. It is very difficult to get any information on this fridge in English hence my e-mail. Regards
Sorry to be slow in replying Greg. I missed your comment coming in.
Yes. The fridge is still doing a great job. I wondered at how the ice maker and cold water dispenser would last considering they get a hit every day here but after three years no problems. No it doesn’t need to be connected to a water supply. Inside there’s a five litre container which feeds the cool water dispenser on the front and the ice maker. Gaun fills ours up every couple of days. It isn’t the biggest of fridges but for the three of us it copes.
You can still get them for under 20,000 baht.
Let me know if you need additional information.
Cheers.
Tony
Hello Tony. Your blog hits a lot of nails on the head. Also I think Australian Franking Credits are not available to non-residents.
Thanks for that additional information Andrew. I would think that issue would apply to many retirees so it is a useful point for them to consider.
Tony
Many thanks for sharing your knowledge on this subject Tony. I must say very good timing as I have an appointment with my financial advisor on the 12th Feb and fly to Thailand to start my new life on the 13th. You have given me some good questions for my Fin Adv to assist me with. I fortunately have my parents address at the moment and own nothing on Thailand yet so will be a longterm visitor for a while at least. I will share any useful strategy my advisor may come up with. Cheers Ian
Cheers Ian. Thank for the offer. I am always up for someone else paying the bill and then tapping into the results of their expenditure!
There are ways around the situation, and I am sure there are examples given online. I have a good friend who got on the wrong side of the tax department and it wasn’t a pleasant experience and boy the penalties are vicious. I am willing to pay the extra tax (unhappily) and sleep at night. The pension situation doesn’t affect me so personally it isn’t an issue. I think that if you can prove some sort of base in Australia and then are backwards and forwards more regularly you’d have a decent argument to claim being a resident. I don’t have kids so the desire to return home just isn’t an issue and the cost of airfares (plus I hate travel) would eat into the tax savings even if I could arrange a “convenient” address in Australia.
Great to hear from you and I see you on FB now, which is a pleasure.
Suck it up, Tony. Government retirement benefits are for those who retire in the country that’s paying them in my opinion. That Australia allows its pensioners to live abroad is a legacy of its extensive migration programme. I’ve lived all over the world for extensive periods of time but have always remained “resident” by virtue of answering “are you a resident of Australia?” on the annual income tax return which is now lodged electronically from wherever I happen to be in the world. That has never been challenged. I would never move permanently to Thailand as I have a persistent medical condition that requires medication (insulin) that I can receive for $5 for six months’ supply if I get it in Australia, and $5 for roughly two days’ supply if I get it in Thailand. There’s pluses and minuses in every decision – you seem to want to keep the pluses and remove the minuses
Thanks for that constructive comment David that adds nothing to the topic. I don’t edit the standard of comments and let all through to express their ideas and yours certainly falls into that category.
Nice to start the comment with “Suck it up Tony” – attacking the author is better served on ThaiVisa where I am sure you are an active contributor (tit for tat). You are obviously a skip reader too as I state in my post “I don’t want to live worrying about a letter from the ATO so I declare and suck it up – but not gracefully” and conclude with the balancing statement “I hope you have found this post useful in touching on some of the realities on the financial side of retiring to Thailand. All in all the fact is that in my case, even despite the frustrations, I can afford to live a simple but very comfortable retired lifestyle here while back “home” I would be retired in a caravan or still working. I know what my preference is”.
Your work situation has no relevance to the target audience of my article. You conveniently also skipped the ATO definition of non-resident in which POINT NUMBER ONE states “If you leave Austalia temporarily and do not set up a permanent home in another country you are an Australian resident for tax purposes” – exactly your situation so your point is what??? Of course you are taxed at Australian resident rates because you match that criteria. Duh. Let’s say that the ruling was changed and you were taxed at 32.5% from dollar one in your situation. I guess you’d just sit back and say “suck it up David”.
You offer no reasonable explanation as to why long term Australian residents and citizens are penalised in the tax/pension systems based on their place of residence. If I was spending my retirement income in Australia I would be paying GST on some things, but as someone on a more limited income a greater proportion of my income would be going on non-GST taxed items like food. You would think that as an aging resident with greater demands on healthcare, aged nursing later in life and all the government infrastructure that is reliant on numbers of clients for resourcing, an encouragement for us types to live elsewhere would be a priority. You are obviously happy to pay tax to support us in our old age a generosity for which the baby boomer population is very grateful.
I enjoyed your whole reasoning for not moving to Thailand – the cost of insulin. I will check on that statement and report back because there are massive numbers of insulin dependant people certainly here in Isaan and they must have access to cheap medication or perhaps it is covered under the 30 baht maximum medical treatment plan introduced by Thaksin. Are you telling me that the overall savings in expenditure by living in Thailand is less than the extra cost of your insulin? I say I “enjoy” because it always gives me a free laugh when negative farangs get going on forums. They will pick up on the one thing in Thailand they dislike and then spread that to cover the entire experience. [Q] “How’s life in Thailand” [A] “Those bloody soi dogs never stop barking”. [Q] “Oh, that’s no good – how’s everything else?” [A] “Bloody wonderful mate – cheap beer, great women, cheap food, cheap accommodation, great climate but those soi dogs!”
Of course I want to keep the pluses and remove the minuses. Wouldn’t you? I only applied logic in my article asking the questions as to why these rulings were in place to discriminate against a 45 year resident like me? Is that not a reasonable question to ask? I am NOT saying I want preferential treatment I just want to be treated EXACTLY the same as fellow citizens? Unreasonable????
You also miss the point of my making the effort to write the post. If you were a fellow Australian thinking of retiring to Thailand wouldn’t you appreciate a heads up about some of the pitfalls financially of doing that? In your case you’d let them get over here, find they have just lost 20% of their expected income in extra tax and then say “suck it up mate”. I’m old school Australian and that’s not what you’d do to another Aussie. Maybe you have been out and about elsewhere in the world for too long and have forgotten the basics of being an Aussie.
Finally in a morning outburst of energy spending far too long replying to a pretty empty comment have you read any of the other of my 320 blog posts? Best summarised by a constructive comment recently posted by Jim Busby “The majority of the blogs are full of your drive and energy to make your life in Thailand with you wife and family all anyone would wish for in their lifetime.” I hope there are people in your life David that would be prepared to make that same statement in your situation (relatively).
Always a pleasure to get rid of that first morning coffee hit on a bit of expressive typing.
Good luck with your life ex-Thailand.
ADDED 11 FEB 2018:
In a final wrap up of what was never supposed to be a serious topic I did manage to check out the cost of insulin, the game changer for David’s decision not to move here, although you do suspect these people troll the blog world just looking to stir so I take it all pretty lightly.
At the pharmacy I use insulin is 350 baht a vial, which is around A$14.00 and depending on dosage gives 10 – 20 shots. My Google search tells me that Type 1 people may require up to four shots a day while Type 2 could get away with one. If David is a Type 1 then insulin is certainly an added expense to everyday life if he moved here but you would certainly make up that with savings in other areas. As I say I doubt this comment was a serious contribution or if it was David needs to re-visit his retirement budget.
Great rebuttal Tony. Poor David
As I’ve said to you on numerous occasions, write, write and write some more. it comes so naturally to you, especially when there is a bit of passion to be expressed…
Thanks Greg. It was all a bit of fun and a change of pace!
Ah yes indeed! Suck it up David as you say. Like Tony I have lived and paid my taxes in Australia for over 30 years. Like many other Australians, it is my right to a pension. It is also my right to decide where I want to live.
Unlike most of the politicians who milk the system. We,as millions of ordinary Australians, have actually made a meaningful contribution to the country’s economy.
Some half brained politician said they should stop paying pensions to people overseas. Tell me how they would cope with providing social housing to 300,000 returning pensioners, when there is currently a 5 year waiting period for those here now?
So why is it OK for me to pay for your insulin subscription,(yes, I do indirectly, like it or not), but it is not for me to get my full pension if I choose to spend extended periods of time overseas, because it is a better life for me and many others who choose to do so as well?
Rather a bit bigoted I think!
Thank you for your comment Brian. The portability restrictions on pensioners living overseas is disgusting. One criteria for all CITIZENS. Once you qualify why should anyone care where you live?
Grrrrr.
Hi Tony
I simpatise with you. On a similar issue in UK if you are non resident like me, the state pension does not go up with RPI . My pension will be fixed from day one.
Best wishes
Terry
Another oddity Terry in your situation. I believe that if you live in some overseas countries the increase applies but others (Thailand included) it doesn’t. So much of our legislation is bogged down in historical conventions that make no sense in the modern world and this is probably an example of that.
Cheers.
Hi Tony,
I am here in California, CA, and have enthusiastically starting reading your blogs, about your life in Thailand. The majority of the blogs are full of your drive and energy to make your life in Thailand with you wife and family all anyone would wish for in their lifetime. I am very happy for you, as I too have entertained the idea of expating, especially with the high cost of living in the US. This is the first real blog you are not your usual cheerful self, and it is very understandable why. It sounds as if you aren’t Aussie anymore, they don’t want anything to do with you. However, they will accept a greater tax extraction on your behalf, as a final boot in the rear for leaving. You have made me start thinking of tax issues overseas, and I meet with my CPA in March and will bring up these items for future reference. I would think, as you alluded too, that with the burden countries face with the increase in caring for an ageing population, that they make it easier, and would be glad to rid themselves of us old farts. Anyway, sorry to hear of your taxing issues, but there’s one thing that they can’t take from you, and that’s your wonderful life with a wonderful family.
Cheers,
Jim
Great to read such a positive comment Jim and you’re not even an Aussie 🙂 Words like yours have brought me back to the blog world and they are very much appreciated.
I still have a lot of time for my adopted country but if you don’t mind me saying, like the American government ours seems to often set itself up to be at war with its citizens especially those more at the bottom of the financial scale. I am old school and believe that citizenship should stand for something such as respect and presumption of “innocence” from the servants of the people (government). If you drive you are presumed to be speeding, if you collect a legitimate government entitlement you are presumed to be intent in ripping the system off and need to be watched and what you access on the internet makes you a potential terrorist that needs censorship and monitoring. I hear from so many expats who come to Thailand to try to get some relief from the big brother of modern government. It is and will continue to happen here too but not to the same religious fervour that government is chasing the expansion of loss of freedoms in many western countries.
Like you I do wonder at a discrimination that discourages retirement abroad. It is a weird absence of logic. If I was in charge I would be handing out a “moving overseas” allowance for anyone over 60 and ship people like me out of there 🙂
Also as you point out I have written 320 blog posts and I think this is the only one that has a hint of negativity – but negative with the positive goal of informing fellow Aussies of aspects that might not be picked up otherwise. My life here is all I could have wished for and so much more. I have enough financially (I knew of the extra tax arrangements) and miss out on very little. I am the happiest I have been my entire life and the move here with Gaun and family has been a life saver (almost literally at moments).
A pleasure to chat. Tony
Glad you took the time to write this Tony. Well put together and highly informative as usual, even with the frustration at the way Aussie expats are treated as non-residents (your rant is quite understated given its impact on you personally…).
The update on living costs also good to read. Notice you left beer off the shopping list 🙂
Your mention of NOK Air brought back memories of landing in Buriram one night in the wet season. After two attempts the pilot got us down in one piece. We all applauded as the palne came to a stop.
Cheers…Greg
Exelent insight and guidance tony
Hi Tony, I don’t know we’re you get the time to do these blogs. It’s 1am and I find them very interesting reading .
Thanks Bob.
I get bursts of energy to write. They come and go. Better than watching TV! Thanks Bob and we will get to see the house soon. It is looking great.
Hi Tony
Thanks for your great blog of your life in Thailand. As a retired Australian with a Thai wife of more than 20 years I always dreamed of retiring in Thailand, however tax laws and the fact my wife preferred to stay in Australia resulted in me retiring in Australia. We do travel to the Khonkaen/Udon Thani region once or twice a year.
Australian tax laws certainly discriminate against its citizens living overseas and even if you wanted to bring your wife back to Australia to live on a permanent basis and start drawing a pension you would face another nightmare with immigration.
Your article is great information for those approaching retirement how are not aware of these laws and Australian retirees need to do some careful planning
Thank you Rudy.
I have a couple of contacts via the blog where the husband wants to come to Thailand but the wife really enjoys the Aussie life and standards. Both sides are chasing the new experience. I do think there is a lot going for a base in Australia and then regular extended trips to Thailand if the budget allows. You sort of pick up on the best of both worlds and there are certainly pluses you could list for both countries (oh I miss those crystal clear Aussie blue skies and long periods of sunshine + wine and beef steaks of course!)
Always a pleasure to hear from you.
Tony