Will Form 8854 Expats 2023-2024

Music. Hi, I'm Jerry Brown, a financial planner for Australian expats in Singapore and around the world. Welcome to my video series where we explore key personal finance topics for Australians at home and abroad. Today, we're talking about withholding tax and what it means for Australian expats. One of the most common misconceptions among Australian expats is that if you buy managed funds or Australian shares while you're a non-resident of Australia for tax purposes, you'll need to pay Australian capital gains tax. This is not true. The tax we need to be mindful of is withholding tax. Australian residents are required to withhold tax whenever income or dividends are paid to non-residents of Australia in three categories: bank interest, dividends from shares when the dividends are unfriend, and royalties. Let's dive into how these rates work. The withholding tax rates are 10% on bank interest and 30% on unfriend dividends. Unfriend dividends occur when the company hasn't paid corporate tax on that portion of income before distributing it to shareholders. These rates apply unless there is a double tax agreement between your country of residence and Australia. For Australian expats living in Singapore, the rates that apply are 10% on bank interest and 15% on unfriend dividends. It's important to note that there is no withholding tax on fully Frank dividends, but there are also no franking credits. One way to avoid withholding tax is to avoid unfriend dividend-paying companies or Australian shares altogether. However, there is no one-size-fits-all approach. As Australian expats living and working abroad, many of us will eventually return to Australia to either work or retire. This means a significant portion of our wealth will be in Australian dollars. Therefore, we need to be mindful of our investments and whether they pay fully Frank, partially Frank, or unfriend dividends, as...