Living Off Rental Income In Australia - Aussie Expats

[Church31]

Hey team, 

 

I have just married my filipino wife in australia and in the process of partner visa.

We are seriously thinking of our future now and planning ahead before we start having kids.

I am thinking to get out the of the rat race in Melbourne and have the opportunity to start

small business in Cebu.

Our financial plan is to buy a property in Melbourne 2/3 bedroom for $250 K -$300 K 

 

 

 

We will have a 5 year plan to pay off this property on a tight budget by year 2021 but also want to start a family in the next few years.

She is 27 and is educated ( was a school teacher in cebu ).

I am 31 . 

 

Is there any australian expats that can tell me how much the Australian Government will tax your income made from property rental in Australia when they become a filipino resident?

 

Im estimating i can get $10,0000 each month from the property to sustain a lifestyle there with a side business. But also she can go back to teaching also. 

 

the property would increase in value over time so i would be able to sell it in 20 years for example 

the property might be worth $500,000 by then. How much does the australian government tax you ?

 

 

[Jollygoodfellow]

On a forum you might get general advice but what you need to do is sit down with an accountant to ensure you are getting the best advice for your situation.

Other advice can be found on the ATO website regarding living overseas.

 

 Puzzled why you think you can get $10'000 a month rental on a $300k house?

[mogo51]

On a forum you might get general advice but what you need to do is sit down with an accountant to ensure you are getting the best advice for your situation.

Other advice can be found on the ATO website regarding living overseas.

 

 Puzzled why you think you can get $10'000 a month rental on a $300k house?

 

JGF, I had the same thought when reading the post.  I I think one too many zeros there, but if true, I am off to Melbourne to buy one!

The OP like you said, should take your advice and go slowly.  I doubt he will get a property in that price bracket that will give him anything like enough to live on in Phils.  His prospective job, should first be obtained and tested for at least 6 months in my view.

[Crocodile]

See this page from the ATO:

https://www.ato.gov.au/rates/individual-income-tax-rates/

 

You may be better off staying an Australian resident for taxation purposes - basically you will pay no income tax for your taxable income up to $18,200.  If you look at it another way, if you have taxable income of $37,000 you are only paying 10% of that to the ATO.  Don't forget about franked dividends also, if appropriate.  You don't need to reside in Australia to be a resident for taxation purposes.  If you are a non-resident, you are taxed at 32.5% as soon as you start to earn.

 

If you are looking for proper financial advice, you might want to discuss with a financial planner, your accountant or someone who is knowledgeable in the area.

 

I know a little about all of this, so am happy to answer the best I can.

[mogo51]

The trick is as you say to 'remain' an Australian Citizen.  It entails a return from time to time, know for pension purposes it is every 26 weeks but cannot comment on the Tax Office interpretation, but I think it will be the same onus, is up to them to prove you are not a 'resident'.

[Jack Peterson]

, but I think it will be the same onus, is up to them to prove you are not a 'resident'.

 

 

OH! OH! Hmmmmm What happens if the Tax Inspector rings and say OK come to the Office on Thursday at 10.15 we can discuss this. (Whatever)   Sorry, it was just in my Mind here, a friend of Mine did this in Spain a few years ago, Claimed SS while Living in Spain and collected money he was only entitled to in the UK. He told them I live in ********* That's OK just come in on So and so and we can get this sorted. Well he was 2 days late but red faced  when they asked OH! were you on Holiday at your House in Spain?  Then of course he was on the radar. Is there no other way around this as it seems upset the Tax Man and it goes on forever.

 

Just Interested that's all.

 

Jack :unsure:

[Dave Hounddriver]

while Living in Spain

 

Was this fellow a permanent resident of Spain or just there on a tourist visa?  I have often wondered how certain governments can declare you a 'non-resident' when you have no legal status as a resident in any other country.  What about people who go off on 'round the world treks and carry all their belongings in a back pack for 3 years or so.  Where is there official residence?

 

Oops.  Sorry.  I went off topic.  So anyway, back on topic.  No one seems to have mentioned the other thread where the problems of being a long distance landlord are mentioned.  It is here:

 

http://www.philippines-expats.com/topic/24070-long-distant-landlording-concern/

[Jack Peterson]

 

while Living in Spain

 

Was this fellow a permanent resident of Spain or just there on a tourist visa?  I have often wondered how certain governments can declare you a 'non-resident' when you have no legal status as a resident in any other country.  What about people who go off on 'round the world treks and carry all their belongings in a back pack for 3 years or so.  Where is there official residence?

 

Oops.  Sorry.  I went off topic.  So anyway, back on topic.  No one seems to have mentioned the other thread where the problems of being a long distance landlord are mentioned.  It is here:

 

http://www.philippines-expats.com/topic/24070-long-distant-landlording-concern/

 

Well it was about the OZ taxman but seems the same all over My man was a Resident of Spain but tried to say he was still a Resident of the UK. UK Law is if you are out of the Country living ( not Travelling) for more that 160 days ( I think that is right) you are considered Non Resident but still liable for tax.

 

They get you all ways but I am sure that the OZ thing will be the same.

 

Anyway sorry if I digressed but I am always Interested in Tax Law just in case it affects me at some stage.

[mogo51]

Gentlemen,

I think I did not explain myself properly in my previous post.  In Oz it is 180 days absence when on a pension before they can raise the point of 'place of residency'They have tried to put this on me many times, even though I am within 180 days before returning to Oz. 

I am not certain of the tax rules, which I indicated.

My other point was that the onus is on'them' to prove you are no longer an Oz resident and I assume it is the same elsewhere, but am very open to correction.

More importantly, the OP should seek professional  advice as suggested several times here.

Edited December 20, 2015 by mogo51

[bows00]

You might want to read my previous thread on long distant land lording. On paper, everything looks ideal, but there are many unforeseen things to consider before taking the dive. There are many experienced real estate investors that are against it. The only reason I will be keeping a property in my home country is just in case I may change my mind about the Philippines and decide to return.