Is UK State Pension Taxed in Australia?

[KAKADU]

Hi

Hopefully my wife and I will be travelling to Australia in early 2025. We have all of our documents and forms in place

to apply onshore for an 804 Visa. I appreciate that initially we could be on a Brdiging Visa A for quite a few years.

My question is this.

My wife and I only have our UK State pensions per month. We do not have any income from any private pensions

or investments etc.

Online I am reading conflicting reports as to wether we will be taxed in Australia on our UK State Pensions.

I appreciate that our Pension will be frozen while we are living in OZ ie no yearly increments

I would be very grateful if someone could clarify the this tax situation.

 

Not sure if this article relates to UK State Pensions.

Holders of Australian Temporary Resident Visas - important change from 1 July 2006 From 1 July 2006 Australia changed its law to exempt from Australian tax, with the exception of income from employment, the non-Australian income of individuals who are temporary residents of Australia. Article 23(2) of the 2003 Convention between the UK and Australia provides that where an individual is exempt from tax by virtue of being a temporary resident of Australia, then the relief to be allowed under the Convention in the UK shall not apply to the extent that income or gains are exempt from tax in Australia. This means that if you hold a Temporary Resident Visa, you are liable to UK Income Tax on your UK source income paid on or after 1 July 2006. UK income paid before that date will qualify for relief from UK tax under the UK/Australia Double Taxation Convention.

 

Many Thanks

 

 

 

[Nemesis]

23 hours ago, KAKADU said:

Hi

Hopefully my wife and I will be travelling to Australia in early 2025. We have all of our documents and forms in place

to apply onshore for an 804 Visa. I appreciate that initially we could be on a Brdiging Visa A for quite a few years.

My question is this.

My wife and I only have our UK State pensions per month. We do not have any income from any private pensions

or investments etc.

Online I am reading conflicting reports as to wether we will be taxed in Australia on our UK State Pensions.

I appreciate that our Pension will be frozen while we are living in OZ ie no yearly increments

I would be very grateful if someone could clarify the this tax situation.

 

Not sure if this article relates to UK State Pensions.

Holders of Australian Temporary Resident Visas - important change from 1 July 2006 From 1 July 2006 Australia changed its law to exempt from Australian tax, with the exception of income from employment, the non-Australian income of individuals who are temporary residents of Australia. Article 23(2) of the 2003 Convention between the UK and Australia provides that where an individual is exempt from tax by virtue of being a temporary resident of Australia, then the relief to be allowed under the Convention in the UK shall not apply to the extent that income or gains are exempt from tax in Australia. This means that if you hold a Temporary Resident Visa, you are liable to UK Income Tax on your UK source income paid on or after 1 July 2006. UK income paid before that date will qualify for relief from UK tax under the UK/Australia Double Taxation Convention.

 

Many Thanks

 

 

 

You wouldn't be on a Temporary Resident visa though, you'd be on a Bridging Visa.

 

Maybe I'm missing something, but are you really planning to live in Aus with no funds except the UK State Pension?

[rammygirl]

Not really sure how people on bridging visas are treated re tax.  Maybe one of our tax bods may answer later.

It will be taxed somewhere though, either in the UK or Australia although if that is your ONLY (no interest or dividends for example) income it won’t be much over the nil rate band anyway.  
I would suspect as you intend to make Australia your permanent place of residence you will be taxed in Australia. 
 

[Marisawright]

On 14/08/2024 at 00:18, KAKADU said:

Hopefully my wife and I will be travelling to Australia in early 2025. We have all of our documents and forms in place

to apply onshore for an 804 Visa. I appreciate that initially we could be on a Brdiging Visa A for quite a few years.

My question is this.

My wife and I only have our UK State pensions per month. We do not have any income from any private pensions

or investments etc.

Your pension shouldn't be taxable.  From the Go Matilda website:

• If you move to Australia on ... a Visitor visa leading to a Bridging Visa once an onshore Aged Parent visa (subclass 804) has been lodged, you are technically a temporary visaholder and can make use of the exemption from the charge to Australian tax in respect of income arising outside Australia. In other words, UK pension income received in this situation will remain properly taxable in the UK.

I assume your child/children will be supporting you, as I cannot imagine how anyone could survive on the British pension in Australia, even if it wasn't frozen.

Assuming you are currently residing in the UK, you will be entitled to medical treatment under Medicare under the reciprocal agreement, but GP visits and prescriptions aren't free, they're just subsidised.  A visit to a GP can cost anything from $40 to $120.  A prescription could be $30 per item.  Dentists and spectacles aren't covered at all, you have to pay full private fees.  It will cost you over $200 just to see a dentist, and a filling can cost over $400.  I got new glasses last week.  I wanted multifocals but they would've cost over $500, so I settled for distant vision only ($300) and will buy cheap reading glasses at the chemist.

I don't know how old you are, but  I'm all too aware how medical expenses start to escalate in your 70s and 80s -- even if, like me and my husband, you felt robustly healthy in your 60s.  And since you'll be on the bridging visa for the rest of your life (the waiting period is 30 years), you'll eventually be facing high medical bills, (we all have to die of something and it's usually expensive).   Australian pensioners get extra subsidies on health care, which you won't get.

Will you be living with your children?  If not, are you aware of the extra fees and taxes you'll pay if you buy a property, and of the current prices for real estate?

 

[Alan Collett]

11 hours ago, Nemesis said:

You wouldn't be on a Temporary Resident visa though, you'd be on a Bridging Visa.

 

Maybe I'm missing something, but are you really planning to live in Aus with no funds except the UK State Pension?

A BV is a temporary residency visa under the Migration Act 1958.

Best regards.

[Alan Collett]

On 14/08/2024 at 00:18, KAKADU said:

Hi

Hopefully my wife and I will be travelling to Australia in early 2025. We have all of our documents and forms in place

to apply onshore for an 804 Visa. I appreciate that initially we could be on a Brdiging Visa A for quite a few years.

My question is this.

My wife and I only have our UK State pensions per month. We do not have any income from any private pensions

or investments etc.

Online I am reading conflicting reports as to wether we will be taxed in Australia on our UK State Pensions.

I appreciate that our Pension will be frozen while we are living in OZ ie no yearly increments

I would be very grateful if someone could clarify the this tax situation.

 

Not sure if this article relates to UK State Pensions.

Holders of Australian Temporary Resident Visas - important change from 1 July 2006 From 1 July 2006 Australia changed its law to exempt from Australian tax, with the exception of income from employment, the non-Australian income of individuals who are temporary residents of Australia. Article 23(2) of the 2003 Convention between the UK and Australia provides that where an individual is exempt from tax by virtue of being a temporary resident of Australia, then the relief to be allowed under the Convention in the UK shall not apply to the extent that income or gains are exempt from tax in Australia. This means that if you hold a Temporary Resident Visa, you are liable to UK Income Tax on your UK source income paid on or after 1 July 2006. UK income paid before that date will qualify for relief from UK tax under the UK/Australia Double Taxation Convention.

 

Many Thanks

 

 

 

See the relevant factsheet here: https://www.bdhtax.com/individuals/tax-factsheets/parent-visa-factsheets/

Hopefully will clarify matters for you.

Best regards.