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Go Matilda - Your Gateway to Australia The Go Matilda Forums The Go Matilda Forums The Tax and Money Forum Tax on UK ISA and TESSA
The Go Matilda Forums The Go Matilda Forums The Tax and Money Forum Tax on UK ISA and TESSA|
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Junior Member |
Hi, Does anyone know how the ATO regard the UK TAX Free Interest element associated with a UK ISA or TESSA.
Is this interest taxable in Australia. regards JandJ |
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Member |
If you are resident for tax purposes in Australia and 'declare' the interest earned on any foreign/overseas investments then I believe you will be taxed at the appropriate rate once the interest is added to all your other earnings.
The ATO certainly appears to get it's pound of flesh out of you and some more! Of course, you do not have to declare any overseas earnings that don't see the light of day in Oz! |
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Member |
It's of little interest to the ATO what tax you have paid - or not paid, in the case of PEPs etc - on earnings abroad. Any more than they are interested in the rate of interest you earned.
It's just the actual amount of interest - you will hand over the appropriate amount of tax as assessed by the Aussies, with a dual-taxation credit if appropriate. Rog Williams |
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Member |
Strictly speaking if the PEP or ISA increases in value over the tax year that increase is added to your yearly Oz income and taxed as such even if the money is left in the UK.
How the Oz tax man would know about this if you didn't declared it I don't know. But strictly speaking if it goes up you pay tax. |
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Junior Member |
Paul
If you have individual quoted stocks wrapped within an ISA or PEP (termed self-select) are these not exempt from an annual tax on unrealised gains according to ATO rulings? Therefore you would only declare dividend income annually and any gains made when stocks are sold (capital gain tax). We have received professional advice which suggests this is the case but other professionals have said not. does anybody know the truth? |
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Member |
I'm no tax expert but what you say makes sense if you can split out the income only that should be taxable.
But when I had a PEP I had 2 unit trusts in the PEP and I never recieved any dividend, just a growth in the fund. I don't know how things have changed as I sold years ago. |
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Member |
ISAs and Tessas are not recognised by the ATO. Therefore you will be subject to Australian tax on annual income or gain as per FIF rules. Cheers |
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Member |
I agree ISAs and TESSA's are not recoginsed by ATO, but these are only wrappers (from UK tax office) and if you just declare the income from these stocks how will the ATO know any different. Only the UK tax office cares about the TESSA status, you are declareing income from stocks you hold to the ATO so it's irrevellent that they are held in a TESSA in the UK. IMHO. |
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Member |
My strategy is to remove the pep/ISA wrapper. Then income will be visible on your statements along with tax credits which can be used to offset against Australian tax. So you have auditable evidence of the tax credits should it be required. Also if these investments are put in a SMSF you can use the 10% tax credits to reduce the super 15% tax during the accumulation phase. |
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Go Matilda - Your Gateway to Australia The Go Matilda Forums The Go Matilda Forums The Tax and Money Forum Tax on UK ISA and TESSA
The Go Matilda Forums The Go Matilda Forums The Tax and Money Forum Tax on UK ISA and TESSA© The Go Matilda Trading Company Limited 2002
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