Expat living in RETIREMENT as a retirement option?

[Deleted member]

This is an interesting article:
The pensioners retiring overseas because they can't afford Australia

 

[ric_melb]

It is not clear whether the OP is receiving funds from an allocated pension, or a government pension or some of each.
Professional advice should be sought as to the tax consequences of living abroad, as it may affect his ability to receive retirement income tax free in Australia, or his chosen country.
I also note from the article GPH referred us to that if an Australian citizen lives abroad for more than 5 years they forfeit their rights to Medicare benefits.
Many expats choose to live in Thailand on retirement. Private health there can be very good, but it is not as inexpensive as many advise.
The other thing for living in a country such as Thailand is whether there is enough going on to stimulate the mind. There is a lack of such activities as "western" music, theatre, news and tv. For some expats such matters can lead to boredom.

 

[marki]

There are Pro and Cons Thailand is but one area and JohnK was not too happy to retire there. Spain is another great place.

 

[burmans]

Private health there can be very good, but it is not as inexpensive as many advise.

Inexpensive in comparison to what, some numbers would be useful here, medical expenses in Australia is far from cheap if you dont want the public health option (which many dont).

The other thing for living in a country such as Thailand is whether there is enough going on to stimulate the mind. There is a lack of such activities as "western" music, theatre, news and tv. For some expats such matters can lead to boredom.

What' they dont get internet in Thailand? Aside from theatre I could get most of those via the internet and be just about anywhere.

 

[JohnK]

I also note from the article GPH referred us to that if an Australian citizen lives abroad for more than 5 years they forfeit their rights to Medicare benefits.

But at the same time they don't forfeit their rights of paying Australian income tax? Government greed at its best.

I can see why people renounce their citizenship of many countries who think they can continue taxing citizens who no longer live there.

 

[dajop]

But at the same time they don't forfeit their rights of paying Australian income tax? Government greed at its best.

A little complicated, but the thrust is you need to demonstrate that you are permanently residing overseas, have no intention of returning to Australia at a specific time, don't maintain a spouse and empty house in Australia, and tick the visitor box on the arrivals card when visiting. Then the only tax you will pay in Australia is what all foreigners pay - withholding tax on investment or interest income associated with shares, managed investments and bank deposits you still hold in Australia - and tax at foreigner rates on rental income associated with any properties you are renting. Very simple. Australian government (generally) isn't interested in taxing you on income you earn outside Australia if you permanently reside outside Australia. It is not like the US where you do need to pay the equivalent of US tax rates on income earned, irrespective of where it is earned.

So if you forfeit your right to Medicare, in most circumstances you will be considered non-resident for tax purposes as well.

There are many things you can fault our government on. This is not one of them.

 

[marki]

But at the same time they don't forfeit their rights of paying Australian income tax? Government greed at its best.

I can see why people renounce their citizenship of many countries who think they can continue taxing citizens who no longer live there.

Don't you become an Australian Citizen that is not resident for taxation purposes. I.e. don't pay Australian tax. This option then makes it more difficult i.e. owning shares property and even paying tax on capital gains.

 

[JohnK]

Don't you become an Australian Citizen that is not resident for taxation purposes. I.e. don't pay Australian tax. This option then makes it more difficult i.e. owning shares property and even paying tax on capital gains.

I'm not sure.

I have met people overseas who were born in Australia and no longer live in Australia but work on oil rigs in the South China Sea, Egypt etc and have to pay Australian tax on those earnings. Why? They then have to renounce their Australian citizenship and take up residence in say Singapore and pay very little tax.

 

[dajop]

I'm not sure.

I have met people overseas who were born in Australia and no longer live in Australia but work on oil rigs in the South China Sea, Egypt etc and have to pay Australian tax on those earnings. Why? They then have to renounce their Australian citizenship and take up residence in say Singapore and pay very little tax.

You do not have to renounce your Australian Citizenship. What you need to do is move your domicile outside Australia. I became PR of Singapore, I didn’t have to renounce my citizenship and Australian government do not consider me a tax resident of Australia.

Essentially if you worked on an oil rig in the South China Sea, but rented an apartment in Singapore and got paid in Singapore (or somewhere else) and either sold or rented out your house in Australia (and had no end date or no intention of returning to Australia on a specific date) and spent less than 180 days in Australia you would be considered a non resident for tax purposes. But if you were on a fixed contract - say 2 years and spent your time off the rig back at your house in Australia then you might be considered a tax resident of Australia - regardless of where you are paid.

There’s some interesting rulings and it is far from simple, but it does seem more difficult to justify a non resident status if you only work outside Australia is only on fixed term contract.

 

[drron]

When it comes to medical services it is also important to realise the extras you can get particularly in Asia where antibiotics are indiscriminately used.Multi resistant bacteria are not uncommon including strains very unlikely to be seen in Australia.hence the reason for choosing wisely when it comes to medical care.And Dental work.

 

[Happy Dude]

This is a great thread. Although I reckon I'll only have enough to fund a late retirement, early death scenario.

 

[Deleted member]

As someone who is an Australian resident but not an Australian citizen, and even though it is my intention to reside overseas in retirement , I will remain domiciled here for tax purposes and return regularly to do my tax returns, see my GP etc. I may decide to add a 3rd passport to my collection to reinforce my status in Australia (I am entitled to citizenship by Descent) if necessary.
I know for some that the burdensome costs of being a retiree in Australia are too much, and the opportunity to live a more fulfilling retirement in another more affordable and safe country is a more palatable option than the misery of battling high costs on a low (fixed) income in Australia. My chosen venue has a few surprises which were not immediately obvious to me, so more research will be needed to ensure I don’t create similar problems to the ones I’m looking to escape. E.g. higher Taxation for one.
However the opportunity to spend most of or all of my retirement years in a different country with enough cultural / language difference is an exciting prospect. So I say to any and all who are considering the option “go for it” but do your research.

 

[marki]

Europe for me close to where Pierogi live

 

[ALH]

Europe for me close to where Pierogi live

We had already decided some years ago that we need to live close to Champagne.

However after reading Juddles posts, I may have to drag GPH to Colombia for a look.