Navigating Superannuation for Australian focused Migrants (and expatriates) before and after arrival in Australia
Last week while in Sydney, I caught up with a senior Asia based expatriate and a South African based migrant eyeing Australia as their future home.
As part of our meeting, our tax specialist highlighted the wealth of opportunity in understanding the nuances of superannuation contributions (foreign and domestic) both before and after becoming an Australian tax resident.
Prior to relocation to Australia, contributions to a foreign superannuation plan (rather than holding assets in a foreign family trust, company or personal name) offer distinct advantages to both save for retirement and manage future Australian tax liabilities. It's a strategic move that can maximize your financial assets before stepping into Australia's tax system.
Once you're an Australian tax resident, the landscape shifts. You and your spouse can each contribute up to $110,000 in after-tax capital to your Australian superannuation each year (ie, $220,000 per couple) .As part of a contribution strategy you can contribute $220,000 pre 30th June and in July a separate three year brought forward contribution each of $330,000 (or $660,000 per couple), enabling recently arrived executives to make substantial ($880,000) Australian superannuation contributions on arrival in Australia.
However, it's crucial to navigate these waters carefully as Australian contribution limits using the 3-year rule (fortunately now extended to just before age 75) could take 9-10 years (with good earnings) to reach the superannuation cap of $1.7 million per person.
Planning and timing are key to optimizing these benefits.
Regards,
Dale Hoy
m) +61 419 364 994
#Superannuation #Expats #FinancialPlanning #AustralianTax #RetirementStrategy
