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How will taxes be determined on returns from my investment in Australia through investor visa program?

My family will be resident in Australia, though likely not citizens, by the time we receive returns on our investment. Will we be liable for taxes on our returns to pay Australian taxes?

  • Education Overseas Academy
    April 04, 2020

    For taxation purposes, any income generated in Australia – including returns on investments in Australia will be taxed, irrespective of whether you are an Australian citizen or migrated from another country and is a resident of Australia. However, the level of taxation will depend on whether you are an Australian resident for tax purposes irrespective of citizenship or nationality. Generally, the 183-day in the given accounting year test will apply. To satisfy this test, you'll need to be present in Australia for at least half the income year, either continuously or with breaks to be classified as a resident for tax purposes. The other three tests that may also apply to determine whether an individual is a resident for income tax purposes are (1) if they are making contributions to the commonwealth superannuation fund, (2) have their domicile or permanent place of abode in Australia, or (3) if they dwell permanently or for a considerable time in Australia.  Thus your intention to remain in Australia (with family) permanently can be seen as being considered as “resident” for taxation purposes. It must be noted that generally Non-Residents are taxed at higher rates than residents for tax purposes.  Also, residents would be able to claim various exemptions to the tax.  However, non-residents (including Australian citizens who are not residents for tax purposes) will be only taxed on income derived from Australia, on the other hand, a resident for tax purposes (even if not an Australian citizen) will be taxed on their global income.  Further, with regard to the taxes on the returns of income, the amount of tax will depend on the type of income derived from the investment.  For example, the income from investment or property such as rent from a lease, interest on a loan, dividends, and royalties may be classified as ordinary income (such as income from efforts) and be taxed at that level.  Certain types of income such as profit from the sale of investment can be classified at the capital gain and be taxed at that level. Certain types of investment returns such as investment in government bonds may not be taxed at all.

  • Julian-Armitage Migration Lawyers (JAM)
    April 03, 2020

    If you are a resident, the tax will be assessed in and out of Australia.