Australians who take out citizenship in another country . . .
Jun 10, 2004, 2:34 am
#46
Join Date: Nov 2000
Location: Sydney, Aus
Programs: QF WP, Starwood Gold, Hilton Diamond, Marriott Gold, Avis President's Club, Amex Platinum
Posts: 2,880
Originally Posted by davistev
You should be fine but if you bring the little ones over to Australia when they are older (say 16 years old), then they may not be granted the youth study allownce because of the 2 year residency rule.
Jun 10, 2004, 2:52 am
#47
Join Date: Apr 2004
Programs: BMI Gold
Posts: 153
And lets not forget that once this mini dual citizenship holder starts working he has to pay US taxes whereever he is in the world. US citizens pay US tax on their worldwide income, there is no such thing as a residency test like in Aust or the UK.
Jun 10, 2004, 4:45 am
#48
Join Date: Apr 2002
Location: Sydney
Posts: 608
Originally Posted by alect
Thanks eamus. Exactly the situation we are facing. I am Aus citizen, mrs alect is seppo, and mini-alect due to arrive in Dec will have both - in fact we will have to get mini-alect both passports within 6 months of birth as he/she will be accompanying us on our RTW and will need US passport to exit/enter US and Aus passport for easier/cheaper entry into Aus.
Jun 10, 2004, 4:52 am
#49
Join Date: Aug 2000
Location: AUS - Formerly MSP, IAD/DCA, SYD, CBR, BNE, JNB
Programs: QF & NW Clubs. Will never buy another ticket on UA or US.
Posts: 1,100
Originally Posted by 747sardine
And lets not forget that once this mini dual citizenship holder starts working he has to pay US taxes whereever he is in the world. US citizens pay US tax on their worldwide income, there is no such thing as a residency test like in Aust or the UK.
Jun 10, 2004, 5:53 am
#50
Join Date: Nov 2000
Location: Sydney, Aus
Programs: QF WP, Starwood Gold, Hilton Diamond, Marriott Gold, Avis President's Club, Amex Platinum
Posts: 2,880
Originally Posted by ANDREWCX
True however there are some countries (including Australia) that have tax treaties with the US so you don't have to pay double taxes... of course there are alot more that don't have treaties...
1. Capital Gains Tax
In the US, your PPR (principal place of residence) is not exempt from capital gains tax. Therefore, as you've not paid tax on selling your house in Australia or the UK (as the case may be), you would be liable for CGT in the US.
2. Pensions / Superannuation
This is the biggy, and is a right pain in the a*se. The US does not recognise any international pension / superannuation funds. Therefore if you say have a UK pension, they will EACH YEAR asses CGT on the increase in value of your UK pension fund from the last year. B*stards. Reason enough alone to give up US citizenship IMHO.
Jun 10, 2004, 6:33 am
#51
Join Date: Aug 2001
Programs: AA Plat & LTG; QF LTG
Posts: 9,837
Originally Posted by ozzie
1. Capital Gains Tax
In the US, your PPR (principal place of residence) is not exempt from capital gains tax. Therefore, as you've not paid tax on selling your house in Australia or the UK (as the case may be), you would be liable for CGT in the US.
In the US, your PPR (principal place of residence) is not exempt from capital gains tax. Therefore, as you've not paid tax on selling your house in Australia or the UK (as the case may be), you would be liable for CGT in the US.
Jun 10, 2004, 7:29 am
#52
Join Date: Dec 2003
Location: Nashvegas
Posts: 867
Taxes
Originally Posted by NM
Yes, but the interest paid on the loan for you PPR is deductable against your income tax, so it is a bit of swings and roundabouts. In the US you gain each year you pay interest on your loan, and then get hit with capital gain. In Australia you can't claim the interest deduction, but are exempt from CGT.
I am a bit surprised by ozzie's comment about US non-recognition of foreign super/pension funds. I asked my tax accountant about this specifically and he said there was nothing to declare (or claim by the way of losses).
Jun 10, 2004, 9:02 am
#53
Join Date: Nov 2000
Location: Sydney, Aus
Programs: QF WP, Starwood Gold, Hilton Diamond, Marriott Gold, Avis President's Club, Amex Platinum
Posts: 2,880
Originally Posted by eamus
In the US you can not only deduct mortgage interest from Federal income tax, you can also carry forward a certain amount of the capital gains on the property ($500K or thereabouts I think) more or less endlessly to your new PPR. Well, until you die, but that is still a significant benefit by deferral. Not as good as the exemption in Oz, but better than an upfront kick in pants. On a cash basis the US system makes home ownership considerably more affordable.
I am a bit surprised by ozzie's comment about US non-recognition of foreign super/pension funds. I asked my tax accountant about this specifically and he said there was nothing to declare (or claim by the way of losses).
I am a bit surprised by ozzie's comment about US non-recognition of foreign super/pension funds. I asked my tax accountant about this specifically and he said there was nothing to declare (or claim by the way of losses).
This is just what I was told by my own tax adviser when we were discussing the issue .... it's not currently an issue for me, but it may be in the future so I guess I'll seek further advice then .....