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Mike Honcho

The Expat Thread.

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No tax paid in Australia on money earned in the middle East. No tax here either. There are some exceptions for some individuals. Things like frequency of visits back to Australia, location of immediate family members and the way your accommodation is arranged in your foreign country. If you and your entire family live in the foreign country, you rent or own your house and don't visit Australia more than 4 times a year you pay nothing.

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Mainly just raised it because it's a topic relevant to expats now. Will pay it if I have to but not feeling guilty about not having to pay it.

We'll foot that one for you. You're welcome :)

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No tax paid in Australia on money earned in the middle East. No tax here either. There are some exceptions for some individuals. Things like frequency of visits back to Australia, location of immediate family members and the way your accommodation is arranged in your foreign country. If you and your entire family live in the foreign country, you rent or own your house and don't visit Australia more than 4 times a year you pay nothing.

Sorry plaz that's an overly simplistic view. As said earlier IF you are an Australian tax resident (which can be different to citizenship)

 

If you were born in Australia you are a resident for tax purposes as that is your "domicile". The below is simplified but in order to not be treated as an Australian resident there are three tests applied:

 

1. Ordinary concepts test - looking at things objectively are you a resident under ordinary concepts. In this you look at things like connection to Australia, family, connection overseas, work, membership of clubs etc etc.

2. Domicile test. In order to change domicile you have to show an intention to change your domicile to another country backed by evidence of change.

3. 183 days test. Your automatically a resident of you spend 183 days in Australia unless you can show you aren't under ordinary concepts.

 

Where most people get caught is domicile test. A domicile is like herpes, very hard to lose. I know matters where someone went overseas permanently with an intention to never return, no assets but because they didn't establish a domicile elsewhere as they didn't establish a permanent residence in another country they didn't lose their Australian one.

 

Every matter is based on evidence and a calculator on the ATO website won't save you.

 

Not saying this is your situation, but you need to be careful.

 

If you get bored look at the Administrative Appeala Tribunal decisions and use the search term residency. You will be surprised.

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I just had a look on the ATO website out of curiosity and it sounds like Plazbot is right

 

 

 

To live permanently in a country means to make it your home indefinitely, meaning for the foreseeable future. You may still travel out of the country.

 

This is the assessment tool http://calculators.ato.gov.au/scripts/axos/axos.asp?CONTEXT=&KBS=residency_leaving.XR4

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Sorry to hijack by the way - just trying to tell you expats to be careful making assumptions - return to purpose of the thread about benefits!

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Some people are worriers, some are not. I try as much as possible to not live my life dictated by worrying or fear. I have not locked the door of either of my residences in the past 4 years. I left my 10+ thousand dollar bike unlocked in a car park for more than an hour while I did a swim the other day. Which by the way is part of the reason that I choose to reside where I do and not in Aus - the greatly reduced number of dickheads you have to share space with.

 

RE the boogey man from the tax department who is one of the 55 active users of this forum -

 

Dear Mr Boogey Man - I've not spent longer than 10 days in Australia nor earned one cent since I left over ten years ago, have achieved permanent residence visa status in Japan (that requires ten years or more consecutive residence), so I doubt very much that you, Wronggenes or the ATO could make a claim that I have been a resident in Australia during the time since I left back in 2002.

 

There are a million Aussie expats around the world like me, and I know they have their eyes on those of us that have not paid our HECS. If they can work out how to force us to pay it, then I'll pay it. But maybe you would be better placed making the country somewhere the best and brightest do not want to leave in the first place - (not putting myself in that basket - I'm just a chancer).

 

And considering I started University in the very first year of the HECS scheme I've always felt a bit begrudging towards it in the first place.

But I'll not be losing any sleep over the boogey man either way.

 

Can we return to the purpose of this thread: Why the Middle East is a shit-hole that deserves an international boycott? It's far more interesting.

Edited by Niseko

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For those that went to non-English speaking countries, have you learned to speak the local language and live in local neighbourhoods as opposed to ex-pat suburbs/communities? Or do you usually end up working in English speaking companies/workplaces?

 

I like the idea of working overseas but when I think about the jobs I might get, it seems pretty much like what I already do here so I can't see the point. Unless I spoke a local language I figure I would be quite limited in any genuinely new experiences I could enjoy. I lived and worked in the UK as a teenager and it was very much the same as it was living and working in Sydney as a teenager...

 

If the money/tax side of things was not important to you, what do you and your family get out of living in a foreign country that you can't get living in Australia?

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Duh...I'm sure I have 2 posts missing so see below.

Edited by Kamal2

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I suppose I am asking what opportunities do you access overseas. Is it career advancement, faster promotions, better environments to start a business. Or is it just for life experience of living in a different country?

 

I expect it would be a positive thing for most children to learn another language and attend schools in other countries but as an adult I can't imagine doing my job without speaking the same language as my co-workers.

 

Did any of you just jump in the deep end?

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Sorry plaz that's an overly simplistic view. As said earlier IF you are an Australian tax resident (which can be different to citizenship)

 

If you were born in Australia you are a resident for tax purposes as that is your "domicile". The below is simplified but in order to not be treated as an Australian resident there are three tests applied:

 

1. Ordinary concepts test - looking at things objectively are you a resident under ordinary concepts. In this you look at things like connection to Australia, family, connection overseas, work, membership of clubs etc etc.

2. Domicile test. In order to change domicile you have to show an intention to change your domicile to another country backed by evidence of change.

3. 183 days test. Your automatically a resident of you spend 183 days in Australia unless you can show you aren't under ordinary concepts.

 

Where most people get caught is domicile test. A domicile is like herpes, very hard to lose. I know matters where someone went overseas permanently with an intention to never return, no assets but because they didn't establish a domicile elsewhere as they didn't establish a permanent residence in another country they didn't lose their Australian one.

 

Every matter is based on evidence and a calculator on the ATO website won't save you.

 

Not saying this is your situation, but you need to be careful.

 

If you get bored look at the Administrative Appeala Tribunal decisions and use the search term residency. You will be surprised.

 

The ATO from memory tightened this up around 18 - 24 months ago. One of our current expats was previously considered non-resident, however due to maintaining a house (left her flat in South Yarra for her parents to use when they came down from the country for medical reasons) and not being stationed in one country (does a regional role that requires travel throughout asia including to Australia), she was deemed to be a resident after the change. Has ended up paying more in tax (which the company has footed due to policy) as she now is taxed locally and in another country. From what I've heard this is only going to be tightened further as time goes on, we now have their status being reviewed annually when their tax is being done for any changes in the year to come

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For those that went to non-English speaking countries, have you learned to speak the local language and live in local neighbourhoods as opposed to ex-pat suburbs/communities? Or do you usually end up working in English speaking companies/workplaces?

 

I like the idea of working overseas but when I think about the jobs I might get, it seems pretty much like what I already do here so I can't see the point. Unless I spoke a local language I figure I would be quite limited in any genuinely new experiences I could enjoy. I lived and worked in the UK as a teenager and it was very much the same as it was living and working in Sydney as a teenager...

 

If the money/tax side of things was not important to you, what do you and your family get out of living in a foreign country that you can't get living in Australia?

I've done both. English speaking and non-English. it depends how you look at things and how comfortable you are with other languages and cultures.When your only language is English and you are in a non Englisg speaking country, it's sink or swim.

 

Work is rarely the issue, as the communicated language for most expat ( rather than migrant) opportunities is English anyway. What needs to be considered is that once you leave work, everything is not in English. The obvious things come to mind like TV, supermarkets, speaking to neighbours but there are myriad things that people don't consider, such as discussing an incorrect utility bill, calling a pumber etc.

 

Some folks are comfortable living in this 'bubble' and some aren't. Personally I love it because it makes you try hard and learn faster but it's easier when you are single. Taking family members feelings about this side of it is harder.

 

Not sure about the language side of things for kids as a reason. Kids can learn a second or third language pretty much wherever they live but that depends on the parents and whether the motivation is there but they do soak up stuff like a sponge and learning will be quicker o/s.

 

Not sure money or tax should be a motivator, it's a bonus. If you're only interested in money, take a soft landing expat package and spend all the time moaning about the locals then your life will be pretty miserable. Having said that, there are places in the world I would only consider due to the money but that does not necessarily go hand in hand with the above.

 

You get out what you put in. The more effort you make on a local level, the more you get back both in interaction and opportunities to meet new people and side a side of where you live that you hadn't before. Living in a foreign country and existing in one are different things.

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I suppose I am asking what opportunities do you access overseas. Is it career advancement, faster promotions, better environments to start a business. Or is it just for life experience of living in a different country?

 

I expect it would be a positive thing for most children to learn another language and attend schools in other countries but as an adult I can't imagine doing my job without speaking the same language as my co-workers.

 

Did any of you just jump in the deep end?

Something about being in a different culture than you were raised in is just kind of fun. Personally I speak Japanese to a decent level (lived with a Japanese girl for a year and we spoke only Japanese) but rarely use it at work. The expat scene in most countries is an interesting and dynamic one to be in. There is a bit of a filter for the type of people who end up there and everyone is away from their old friends and family and more likely to meet new people.

 

Personally I moved to have a try at a business opportunity (packed a container full of Physio products and sent it before I arrived in Japan and had to find a place to put it before the ship arrived!). I just. thought would be easier and a better business OS than it would be in Australia. Less competition was part of it. Now it's gone OK I've no plans on going home.

 

The infratructure, attitude of the people, crime, tax, level of service, attitude to cyclists and consideration to the people and space around them are all better in Japan than in Aus.

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I suppose I am asking what opportunities do you access overseas. Is it career advancement, faster promotions, better environments to start a business. Or is it just for life experience of living in a different country?

 

I expect it would be a positive thing for most children to learn another language and attend schools in other countries but as an adult I can't imagine doing my job without speaking the same language as my co-workers.

 

Did any of you just jump in the deep end?

 

All of your points above - new experiences, good opportunity to do something different, it made my career, met my wife, saw the world....

 

When you 'jump in at the deep end' you realise that its not actually that deep and that the world is a small place.

 

Everywhere you go there are expats from around the world all swimming at the deep end ... so many that you eventually start to feel that your not that special coming from another country, because a quarter of your workmates are also from another country.....

 

And with things like skype, instant messaging, facebook and so on the world is becoming smaller by the minute ....

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Plazbot - I would get some advice on that, this is a massive area for the ATO right now, A lot of people who think there not residents are.

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Plazbot - I would get some advice on that, this is a massive area for the ATO right now, A lot of people who think there not residents are.

I have solid advice. I am on the extreme end of the spectrum of the test. Absolutely no ties in Australia to anything. I am also in receipt of a letter from the ATO from when we left claiming back 3 weeks of family tax benefit B that we were not entitled to as we are non residents for tax purposes. I'm sure it is possible for the rules to change in the future and I certainly keep am eye on them.

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For those that went to non-English speaking countries, have you learned to speak the local language and live in local neighbourhoods as opposed to ex-pat suburbs/communities? Or do you usually end up working in English speaking companies/workplaces?

 

I like the idea of working overseas but when I think about the jobs I might get, it seems pretty much like what I already do here so I can't see the point. Unless I spoke a local language I figure I would be quite limited in any genuinely new experiences I could enjoy. I lived and worked in the UK as a teenager and it was very much the same as it was living and working in Sydney as a teenager...

 

If the money/tax side of things was not important to you, what do you and your family get out of living in a foreign country that you can't get living in Australia?

I've done both. Did a 3 year stint in HK and lived in an ex-pat area and mixed mostly with ex-pats. Regret not learning Mandarin when my office offered lessons and I only picked up a few words of Cantonese. Didn't meet many ex-pats that impressed me as they were mostly there for the cash and the Asian girls. When I left the only ones I've kept in touch with were my Chinese friends.

 

In Bahrain my company set me up in a flat in a quiet ex-pat part of the island and after 1 year I couldn't wait to get out. I found a gorgeous home in Barbar (one of the political 'hot-spots' so-to-speak which is why my rent is ridiculously cheap). The property owner has about 12 villas surrounded by lush gardens and I'm 5 minutes from work and 5 minutes from our main training spots.

 

The business language here is English but I'm picking up Arabic from my friends. I work for an small business run by an Englishman but most of my friends outside of work are Bahraini, who generally seem to be happier people than the ex-pats (again, many ex-pats here for the cash, not to lay down roots).

 

Job is the same as what I do back in Aus but the standard is lower in Bahrain and I don't mind it all as I can walk away at 6pm and train without stress.

 

What I get out of being here is a massive education in world cultures, an understanding of world politics that I couldn't get in Aus, travel opportunities (one of the most valuable of life's experiences) and plenty of disposable cash which gives me power to make choices about my life.

 

The physical landscape is certainly nothing to write home about but you can find places of great beauty and I love the old Arabic architecture with their high ceilings and wind-towers. Here are some pics of my home for the ignorant ones that imagine the M.E. as a 'shit-hole':

 

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P1080885_zpspczrjlfl.jpg

Edited by The Customer

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For those that went to non-English speaking countries, have you learned to speak the local language and live in local neighbourhoods as opposed to ex-pat suburbs/communities? Or do you usually end up working in English speaking companies/workplaces?

 

I like the idea of working overseas but when I think about the jobs I might get, it seems pretty much like what I already do here so I can't see the point. Unless I spoke a local language I figure I would be quite limited in any genuinely new experiences I could enjoy. I lived and worked in the UK as a teenager and it was very much the same as it was living and working in Sydney as a teenager...

 

If the money/tax side of things was not important to you, what do you and your family get out of living in a foreign country that you can't get living in Australia?

 

I was speaking a good level of Arabic within the hospital, but outside where slang and some Bedouin dialects were used it didn't hold up so well. I could detect the Bedouin accent and could adapt to Egyptian or Lebanese. Arabic has many different local accents using the same words.

 

My younger daughter spoke Singhalese and good English. She got some US Navy training in 3 different dialects almost 3 different languages, Gulf Arabic, Iraqi which is similar and Farsi the Persian language. Her job is semi classified in the we know what she does but we don't have additional details.

 

I reckon it's weak to live over there and not pick up a bit, but some Yanks and Brits are like that.

 

As far as living in local neighbourhoods, it really doesn't work like that. If you did move out you might be living next to an Indian or Lebanese, not the Saudi's.

Edited by Kamal2

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I moved to Thailand for an 18 month gig with the company i was working for in Aust. I took the role to gain some extra professional experience as well as a bit of an adventure.

 

A very soft landing with everything taken from drivers to housing to removals to schools all done without any dramas at all. There is a huge Expat community here which doesn't need to integrate with the locals which is good and bad. We had 5 Aussie families move here from the same company so we had our own little Aussie group that merged with the expat groups pretty quickly.

 

Due to the kids going to an international school we meet people from all over the world with many being married to Thai spouses. My kids know less Thai than I do, but then again i work with thousands of Thai every day. Most of the language that I know relates to the work I do, and of course obtaining a beverage. My wife doesnt know the language and cant be bothered with learning it. In saying this, the level of English of the locals is high enough to get what we need.

 

Money. I wouldnt have come here if I was going to lose money. The company effectively ensure I pay a flat 20% tax. The increase in wages for me was enough to cover the reduction in wages by my wife going on study leave (Defence pay her for the study she does, so a 50% wage ATM). What i didnt factor in was the new taxes the government was to introduce and many of those hit me hard. I found other taxes I never thought existed. I always knew i I was a tax resident and therfore didnt try and make changes. PWC was appointed to do our tax and this is what they sent through to me regards Residential Status.

 

Resident status
Each income tax year, your tax residency is determined by applying various criteria as specified in Australian legislation, case law and ATO Taxation Rulings to your past, current and intended facts and circumstances.
When determining whether an individual is a non-resident of Australia for Australian tax purposes, the ATO must be satisfied that:
a) you have ceased to reside in Australia (the “resides” test); and
B) if you have an Australian domicile (for example, you are an Australian citizen), the Commissioner is satisfied you have established a permanent place of abode outside Australia and that permanent home is available to you at all times (the “permanent place of abode” test). Because both of the above tests need to be satisfied in order for you to break residency, you are a tax resident of Australia if you are considered to be “residing” in Australia, regardless of whether or not you have a permanent place of abode outside of Australia.
ATO Scrutiny on the “resides” test
The tax residency status of outbound Australian Citizens has attracted increased ATO scrutiny in recent years, in particular regarding the “resides” test which is not defined in Australian legislation and so takes its ordinary meaning. Case law, however, gives the term “reside” a wide meaning and indicates you may be treated as an Australian resident if you have:
• a “continuing association” with Australia (eg because your spouse and / or children are residing in Australia; and / or family home is available for your use; family connections; location of assets and investments etc.); and
an intention to return to Australia at any point in the future; and
• behaviours and attitudes that are consistent with Australia remaining as your home.
Further, the main factors to be considered when determining where you are residing are:
• physical presence in a particular country
• nationality
• history of residence and movements
• habits and mode of life
• frequency, regularity and duration of visits to that country
• purposes of visit to or absences from a country
family and business ties with a country
• maintenance of a place of abode
Moreover, the ATO may take the position that you have continued to “reside” in Australia and should therefore be considered resident of Australia for tax purposes where:
• Your family (ie spouse and / or children) remain in Australia;
• You maintain a home in Australia that is available for you /your family’s personal use and enjoyment; or
• You frequently return to Australia throughout a year.
Based on your facts and circumstances (as disclosed in the information you provided to us in your tax questionnaire), your tax return has been prepared on the basis that you are a tax resident of Australia for the 2014 tax year. We have formed this view because we consider you are continuing to reside in Australia during your foreign assignment. As a tax resident, you are taxed on your worldwide income and gains.
If you believe your facts and circumstances have changed or you would like to discuss your residency position for the tax year ended 30 June 2014, please contact us.

 

 

The bits in red are the hardest to disprove in my mind.
I am happy to pay taxes in Australia if it affords those in need the comfort to survive with dignity.
Would I do this type of gig again? I would but not in Thailand unless the role was dramatically different to what I'm doing now.
What do my family get out of being here? We get the chance to travel around Asia very easily, meet new people, and give some life experience to the kids (10 and 8).
What do we miss? We miss normality, cold weather and having family close by.
The worst thing about living overseas on an assignment is the "putting life on hold" for a few years. This is a feeling that I didnt know I was going to have and couldnt have prepared for it. Its tough not being about to do things or having to delay them till you return home to do them.
What would I change? Nothing.

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We first left Australia in 1997 for 2 years in KL while I was on the Petronas Tower project. Returned home for 6 months then the boss called me back to finish a few other projects. It ended up being another year, during which the company flew the clan back in during school holidays.

 

Ended up back and forth doing resort projects in Thailand and Micronesia during 2001 and 2002. Last worked in Australia in 2003 and left for a high speed rail project in Taiwan until 2005.

From 2005 until now ended up working in Dubai, then Saudi, India, Qatar, Vietnam and Abu Dhabi. Now back in Qatar.

Projects ranging from factories manufacturing semi conductors, mobile phones, resorts, equestrian centre, a concert hall and railway sleepers.

 

Have enjoyed the challenges and working with a whole bunch of people with different skill levels. Has not been easy but has been satisfying - both professionally and financially.

 

Will be keeping it up for another 3-5 years then home again, home again, jiggedy jig. Very much looking forward to it and will try to settle into a quite life in the Eurobodalla.

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I also get a kick out of the little things such as, filling up my car for 9AUD, having a cleaning lady for 6AUD per week, Bahraini breakfasts after training, swimming in the Persian Gulf, the sound of prayer time, camels on the highway when I go to work each morning and seeing the most beautiful Arabian horses in the world being ridden up and down my street.

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