Australia is a 'Tax Haven' for temporary visa holders

There are new opportunities to increase your wealth by moving abroad. Your choice is now a lot wider, with Australia joining the ranks of those countries seeking to attract tax exiles. In fact it must be the only advanced English speaking country that offers all year round sunshine, a pleasant place to live, yet there can be no tax to pay for the privilege.

The Detail

From 1 July 2006, all temporary visa holders are no longer subject to Australian income tax on most foreign income and capital gains. This applies regardless of whether the income etc is remitted to Australia, how long you have had a temporary visa or stay in Australia each year.

The good news rolls on. Owning shares in most Australian public companies and unit trusts will result in tax free Australian capital gains as well.

The Challenges

The remaining issues are to also avoid taxation in the countries where you now live and where the income or capital gains flow from. This requires a detailed knowledge of their local and international tax rules. Moving assets to a third jurisdiction can also help.

In the case of inheritance type taxes, avoid locating assets that you own in those countries. Australia does not impose any inheritance, death, estate, wealth or gift taxes.

The Result

If all of the above can be achieved, then you will be living in a truly “tax haven” type fiscal environment. Your hard earned money will last longer, giving you and your family greater security and purchasing power.