Australian Aged Pension

[OLDAUSSIE]

I think you will find the Ombudsman will only take complaints in writing. The Commonwealth Ombudsman receives over 5,000. complaints a year about Centrelink and their staff.

[OZEMADE]

Are there any Australian pensioners who retired to Thailand when they were getting the Australian pension (age 65plus), and are still there say 5 or six years later still getting their Australian pension ?

Payments paid while outside Australia

This link should answer all your questions re OLD AGE PENSION (OAP)

Go right down the list once you bring it up, Overseas section is there as well.

http://www.humanservices.gov.au/customer/enablers/outside-australia

[Xangsamhua]

Mrs Xangsamhua has a small savings account in Thailand. No Australian money has been used to set up or deposit into this account.

The Centrelink income and assets form asks that all overseas accounts held by the applicant and his partner be declared. Mrs X feels that her personal Thai account is of no business to Centrelink and doesn't want to declare it unless it's really necessary. What is the advice of those with experience in these matters?

[electau]

Mrs Xangsamhua has a small savings account in Thailand. No Australian money has been used to set up or deposit into this account.

The Centrelink income and assets form asks that all overseas accounts held by the applicant and his partner be declared. Mrs X feels that her personal Thai account is of no business to Centrelink and doesn't want to declare it unless it's really necessary. What is the advice of those with experience in these matters?

Exactly, any bank accounts in Thailand are of no concern of Centrelink and you just do not declare them. If she has property in Thailand it is of no concern of Centrelink, it belongs to her family not her.

[chainarong]

I thought the 13 week rule applied to other Centrelink payments such as the dole, not aged pensions. I would take the advice of immigration officers at the airport with a large grain of salt.

There are also other rules as well as being in Australia on the day you lodge. You must have lived in Australia for a minimum number of years during your working life- I think 20 years - and paid tax during that time. It's all on the Centrelink website.

We both receive aged pension as previously stated, , on the 9th of december we were called into centrelink Caboolture for an interview, to prove that we actually did return to australia, we were informed that as aged pensioners we have to inform centrelink when leaving australia and if leaving for over 13 weeks financial penalties could apply,Ignou

That is correct you would loose your rent allowance etc and end up with just the basic pension, you can stay out as long as you like , just let Centrelink know your status. The 13 weeks applies to other pensions paid ,disability pension etc.

[soloman]

Exactly, any bank accounts in Thailand are of no concern of Centrelink and you just do not declare them. If she has property in Thailand it is of no concern of Centrelink, it belongs to her family not her.

The Centrelink income and assets test relates to all income by both partners, and all assets owned by both people. If you want to keep it private from Centrelink, then you can only do that legally by not claiming a pension from them. Alternatively, if a person is not living with their girlfriend, then that person might claim the single person pension, and their girlfriends assets and income are of no concern to Centrelink.

[electau]

Exactly, any bank accounts in Thailand are of no concern of Centrelink and you just do not declare them. If she has property in Thailand it is of no concern of Centrelink, it belongs to her family not her.

The Centrelink income and assets test relates to all income by both partners, and all assets owned by both people. If you want to keep it private from Centrelink, then you can only do that legally by not claiming a pension from them. Alternatively, if a person is not living with their girlfriend, then that person might claim the single person pension, and their girlfriends assets and income are of no concern to Centrelink.

Your Thai spouse justs states that she has nil assets in or income from Thailand. Australia has no social security agreement with Thailand. This incudes any assets in her family name. There will of course be no transfers of money to her bank account in Australia, which of course would be highly unlikely.

My wife has assets in Thailand and they are held in her family name.

[Artisi]

I notice there have been a few post lately on the 2 year qualifying period for those of us who spent a fair bit of time "out of the country".

My story was set out in full regarding not being granted portabilty due to be out of Aust for a number of years which I protested and won.

Refer to post No 51 and 58, nothing much would have changed in the time since I was involved with Centrelink on this matter. I have also had a fair few dealings with the International section since returning to Thailand and must say have always been given good service and all queries answered without any problems.

[OZEMADE]

I thought the 13 week rule applied to other Centrelink payments such as the dole, not aged pensions. I would take the advice of immigration officers at the airport with a large grain of salt.

There are also other rules as well as being in Australia on the day you lodge. You must have lived in Australia for a minimum number of years during your working life- I think 20 years - and paid tax during that time. It's all on the Centrelink website.

We both receive aged pension as previously stated, , on the 9th of december we were called into centrelink Caboolture for an interview, to prove that we actually did return to australia, we were informed that as aged pensioners we have to inform centrelink when leaving australia and if leaving for over 13 weeks financial penalties could apply,Ignou

That is correct you would loose your rent allowance etc and end up with just the basic pension, you can stay out as long as you like , just let Centrelink know your status. The 13 weeks applies to other pensions paid ,disability pension etc.

Except those paid by and on a Dept of Veteran Affairs (DVA) Pension, and those on a DVA disability pension, ie a Totally and Permanently Incapacitated a (TPI). The only thing they loose is their enviromental allowance and their phone allowance after 13 weeks, which is reinstated immediately on them notifying the DVA of their return to Australia. It is also backdated to the date of arrival.

[marquis22]

I was told by a friend that he was informed by Centrelink that from January 2013 the Age Pension will only be paid for 6 weeks while out of Australia. I presume that is for each year?

[harrry]

Y

I was told by a friend that he was informed by Centrelink that from January 2013 the Age Pension will only be paid for 6 weeks while out of Australia. I presume that is for each year?

\Your friend is wrong.

Read the Centrelink site. Age pensions which have been held for more than 2 years will continue to be paid but the rate may reduce to reflect the number of years you have lived in Australia during your working age. The 6 weeks is the period where some allowences continue to be paid. THey are not payable if youare away more.

[OLDAUSSIE]

I was told by a friend that he was informed by Centrelink that from January 2013 the Age Pension will only be paid for 6 weeks while out of Australia. I presume that is for each year?

Total Rubbish.

[marquis22]

I was told by a friend that he was informed by Centrelink that from January 2013 the Age Pension will only be paid for 6 weeks while out of Australia. I presume that is for each year?

Total Rubbish.

Here is Centrelink website quote:

Age Pension and Pension Supplement

From 1 January 2013 if you leave Australia temporarily, eligibility for Pension Supplement will reduce from 13 weeks to six weeks.

Current rules:

You can get Age Pension for the whole time you’re overseas, regardless of whether you leave Australia temporarily or permanently. The rate of Pension Supplement you receive will reduce on departure if you leave Australia permanently or after 13 weeks if you leave Australia temporarily.

The amount you receive may change again if you remain outside Australia for more than 26 weeks.

If you returned to live in Australia and were granted or transferred to Age Pension within the last two years, you will not be able to receive your Age Pension outside the country. After you return, to be paid outside the country, you must have been living in Australia for two years since your last arrival for residence.

My friend and I just turned 65 so it sounds like we have to live in Australia for 2 years on the pension before we can live extensively in Thailand as I am going to Thailand for 3 months, December to March 2013.

Or is there a difference between Age pension and pension supplement?

[simple1]

I was told by a friend that he was informed by Centrelink that from January 2013 the Age Pension will only be paid for 6 weeks while out of Australia. I presume that is for each year?

Total Rubbish.

Here is Centrelink website quote:

Age Pension and Pension Supplement

From 1 January 2013 if you leave Australia temporarily, eligibility for Pension Supplement will reduce from 13 weeks to six weeks.

Current rules:

You can get Age Pension for the whole time you’re overseas, regardless of whether you leave Australia temporarily or permanently. The rate of Pension Supplement you receive will reduce on departure if you leave Australia permanently or after 13 weeks if you leave Australia temporarily.

The amount you receive may change again if you remain outside Australia for more than 26 weeks.

If you returned to live in Australia and were granted or transferred to Age Pension within the last two years, you will not be able to receive your Age Pension outside the country. After you return, to be paid outside the country, you must have been living in Australia for two years since your last arrival for residence.

My friend and I just turned 65 so it sounds like we have to live in Australia for 2 years on the pension before we can live extensively in Thailand as I am going to Thailand for 3 months, December to March 2013.

Or is there a difference between Age pension and pension supplement?

Pension supplement is a subsidy for some living costs, if you qualify, such as a small rental allowance, phone etc. These supplements will not be paid when you return to Thailand after the current two year qualifying period for overseas payment of the OAP.

[jingjoe8]

How many aussies here are now non residents?I have just been told i have automatically become one after 2 years living here.

There doesn't seem to be any upside,i still pay taxes in oz,but don't qualify for medicare now(but don't have to pay medicare levy) and the tax threshold has changed

as of may 2012, 32.5% up to $34000,

so any money generated from renting out a house is now taxed at 32.5%.

[OLDAUSSIE]

How many aussies here are now non residents?I have just been told i have automatically become one after 2 years living here.

There doesn't seem to be any upside,i still pay taxes in oz,but don't qualify for medicare now(but don't have to pay medicare levy) and the tax threshold has changed

as of may 2012, 32.5% up to $34000,

so any money generated from renting out a house is now taxed at 32.5%.

The law and rules for Pension and ATO are different regarding residency. They should not be. If Centrelink have taken away your residency I would be putting a challenge to the ATO to the fact of not being a resident regarding C/L, so why should the ATO be any different. I think it could be worth a try.

[jingjoe8]

How many aussies here are now non residents?I have just been told i have automatically become one after 2 years living here.

There doesn't seem to be any upside,i still pay taxes in oz,but don't qualify for medicare now(but don't have to pay medicare levy) and the tax threshold has changed

as of may 2012, 32.5% up to $34000,

so any money generated from renting out a house is now taxed at 32.5%.

The law and rules for Pension and ATO are different regarding residency. They should not be. If Centrelink have taken away your residency I would be putting a challenge to the ATO to the fact of not being a resident regarding C/L, so why should the ATO be any different. I think it could be worth a try.

Im not pension age,reading the ato site if you reside outside of oz for longer than 183 days for a period of 2 years or more you become a non resident,if you avoid this it is classed as tax evasion.

my accountant says with all the ties between ato,immigration and others,its a no brainer to eventually be caught.

Most of my investments are fully franked,i now lose the franking credits,also a huge chunk of rental income will now go to tax

.I am now a highly taxed citizen of oz,with no medicare access,and probably won't be eligible for a pension in 20years!!

[Old Croc]

How many aussies here are now non residents?I have just been told i have automatically become one after 2 years living here.

There doesn't seem to be any upside,i still pay taxes in oz,but don't qualify for medicare now(but don't have to pay medicare levy) and the tax threshold has changed

as of may 2012, 32.5% up to $34000,

so any money generated from renting out a house is now taxed at 32.5%.

The law and rules for Pension and ATO are different regarding residency. They should not be. If Centrelink have taken away your residency I would be putting a challenge to the ATO to the fact of not being a resident regarding C/L, so why should the ATO be any different. I think it could be worth a try.

They are different as they use their own separate legislation to define a resident for payment of pensions or to rip tax from you.

Neither are close to Immigration's version of residency or citizenship.

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

(when they catch up with me)

[jingjoe8]

its 32.5% up to $80 000,which will bite into my self funded retirement as well

http://www.bantacs.com.au/booklets/Overseas_Booklet.pdf

[Berek]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

[Old Croc]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

As I'm over 60 my superannuation pension has been taxed at a low rate (about $500 a year).

By declaring me to be a non-resident, ATO want to tax me the same as if I was a backpacker picking fruit.

The new rate from 2013 is 32.5 cents for every dollar earned starting at zero.

Effectively my superannuation of approx AUD34,000 will attrack tax of over $11,000!!!

[jingjoe8]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

As I'm over 60 my superannuation pension has been taxed at a low rate (about $500 a year).

By declaring me to be a non-resident, ATO want to tax me the same as if I was a backpacker picking fruit.

The new rate from 2013 is 32.5 cents for every dollar earned starting at zero.

Effectively my superannuation of approx AUD34,000 will attrack tax of over $11,000!!!

Of course it all depends on how your self funded super is sourced, for eg if it consists of dividends that are fully franked as shares of telstra are and many banks you will not be taxed on these,company taxh as already been paid,you can't claim the franking credits back now(franking credits been the tax is paid at company rate 32 ish percent if you didn't pay that rate of tax you get a tax refund)but your dividend return is a nett dividend.

Also any rental income can also have a lot of depreciation offsets such as electrical items etc,plus rates and insurances can be offset.

So even though the non resident tax looks bad..it might just be you need to adjust your investments

The big killer for me as i approach older age is the loss of medicare,i will need to keep paying my private health care here and fingers crossed they will insure me when i'm over 65.

[Old Croc]

I was a government worker, my superannuation is administered by COMsuper. I don't have the option of moving it around.

I will be looking at ways to move all my other investments out before they purloin that.

[Phronesis]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

As I'm over 60 my superannuation pension has been taxed at a low rate (about $500 a year).

By declaring me to be a non-resident, ATO want to tax me the same as if I was a backpacker picking fruit.

The new rate from 2013 is 32.5 cents for every dollar earned starting at zero.

Effectively my superannuation of approx AUD34,000 will attrack tax of over $11,000!!!

Only if you are dull or lazy:

Tax rates options for the wise aussie non residents:

1. shares with fully franked dividends: no tax

2. interest on bank deposits: 10%

3. (my personal favourite) Establish a discretionary trust with you as a named beneficiary (google Cleardocs costs less than $300. If established in QLD no stamp duty applies): 10% on distributions to offshore beneficiary

4. Establish a company (google Cleardocs costs less than $300) You will need a trusted person in Oz as one of the directors as you cannot have a sole non resident director. Use your investment income earned on your retirement capital to pay for your expenses here in Thailand (because you are here hunting around for investment opportunities): 30% tax on any income of the company not used up by your expenses. If you have lots of expenses then your tax will be zero.

The trust is often a better option because there is no annual ASIC fees or other corporate reporting or compliance responsibilities. The trust also provides asset protection advantages.

Stop whinging about being victimized by the ATO and start properly researching your options...

[Old Croc]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

As I'm over 60 my superannuation pension has been taxed at a low rate (about $500 a year).

By declaring me to be a non-resident, ATO want to tax me the same as if I was a backpacker picking fruit.

The new rate from 2013 is 32.5 cents for every dollar earned starting at zero.

Effectively my superannuation of approx AUD34,000 will attrack tax of over $11,000!!!

Only if you are dull or lazy:

Tax rates options for the wise aussie non residents:

1. shares with fully franked dividends: no tax

2. interest on bank deposits: 10%

3. (my personal favourite) Establish a discretionary trust with you as a named beneficiary (google Cleardocs costs less than $300. If established in QLD no stamp duty applies): 10% on distributions to offshore beneficiary

4. Establish a company (google Cleardocs costs less than $300) You will need a trusted person in Oz as one of the directors as you cannot have a sole non resident director. Use your investment income earned on your retirement capital to pay for your expenses here in Thailand (because you are here hunting around for investment opportunities): 30% tax on any income of the company not used up by your expenses. If you have lots of expenses then your tax will be zero.

The trust is often a better option because there is no annual ASIC fees or other corporate reporting or compliance responsibilities. The trust also provides asset protection advantages.

Stop whinging about being victimized by the ATO and start properly researching your options...

If you weren't so dull and lazy perhaps you might have read my post # 773 and wouldn't be suggesting something impossible for me to do.

This thread is for Australians to discuss pensions and taxation as it affects us living in Thailand.

If you want to throw insults around go back to General and I'll meet you there.

[Ned]

Phronesis: You say: 10% tax on interest on bank deposits. Why wouldn't this be taxed at 32.5%? I hope you're right.

Also shares with fully franked dividends you say are not taxed, even for non residents. This sounds good too.

[jingjoe8]

Phronesis: You say: 10% tax on interest on bank deposits. Why wouldn't this be taxed at 32.5%? I hope you're right.

Also shares with fully franked dividends you say are not taxed, even for non residents. This sounds good too.

Fully franked dividends have already been at company rate and then passed on to shareholder,so in effect tax has been paid,i would suggest the 10% interest tax is to encourage or not discourage deposits in australian banks which is a cheap way for the banks to finance themselves.

[Will27]

As a self funded retiree (no C/L pension) and with no overseas income, I greatly resent having to pay a non-residents tax rate on my superannuation and savings earnt over a lifetime of work in Australia!

I would have thought if you're retired and over 60 it's all tax free?

As I'm over 60 my superannuation pension has been taxed at a low rate (about $500 a year).

By declaring me to be a non-resident, ATO want to tax me the same as if I was a backpacker picking fruit.

The new rate from 2013 is 32.5 cents for every dollar earned starting at zero.

Effectively my superannuation of approx AUD34,000 will attrack tax of over $11,000!!!

Only if you are dull or lazy:

Tax rates options for the wise aussie non residents:

1. shares with fully franked dividends: no tax

2. interest on bank deposits: 10%

3. (my personal favourite) Establish a discretionary trust with you as a named beneficiary (google Cleardocs costs less than $300. If established in QLD no stamp duty applies): 10% on distributions to offshore beneficiary

4. Establish a company (google Cleardocs costs less than $300) You will need a trusted person in Oz as one of the directors as you cannot have a sole non resident director. Use your investment income earned on your retirement capital to pay for your expenses here in Thailand (because you are here hunting around for investment opportunities): 30% tax on any income of the company not used up by your expenses. If you have lots of expenses then your tax will be zero.

The trust is often a better option because there is no annual ASIC fees or other corporate reporting or compliance responsibilities. The trust also provides asset protection advantages.

Stop whinging about being victimized by the ATO and start properly researching your options...

I think you're being a bit harsh there fella.

As Old Croc has said, he is on a govt superannuation which is taxed at source.

Out of the four options you've suggested, I cannot see one which will help

Old Croc and his situation. Perhap you can enlighten me.

BTW, I think it is extremely unfair that someone can work their whole life in

Australia, and then if they wish to relocate overseas, they can have over a third

of their pension taken.

Regards

Will

[David48]

Agreeing with Will27 above.

I'm surprised and disappointing with a system which treats the accumulated superannuation and taxed in this way ... and Old Croc ... my sympathies.

Now Will27 did not say this ...

I maintain that the OAP is a privilege and not a right.

Yes, you did work the majority of your life in Australia and paid your taxes ... but you also enjoyed, at the time, the benefits of those taxes through the various services you used, schools, hospitals, roads and the like.

The OAP, disability pension and the like, should only be paid in Thailand at a reduced rate to reflect the cost of living in Thailand ... or elsewhere in the world.

If you wanted financial independence ... you should have planned for it 20 or 30 years ago.

Your current pension is being paid for by your children and grandchildren's taxes ... not yours ... despite what you might believe.

Don't blame the government now for tightening the rules as the rules and the concept of the OAP were written in a different world, for a different age.

[Old Croc]

Agreeing with Will27 above.

I'm surprised and disappointing with a system which treats the accumulated superannuation and taxed in this way ... and Old Croc ... my sympathies.

Now Will27 did not say this ...

I maintain that the OAP is a privilege and not a right.

Yes, you did work the majority of your life in Australia and paid your taxes ... but you also enjoyed, at the time, the benefits of those taxes through the various services you used, schools, hospitals, roads and the like.

The OAP, disability pension and the like, should only be paid in Thailand at a reduced rate to reflect the cost of living in Thailand ... or elsewhere in the world.

If you wanted financial independence ... you should have planned for it 20 or 30 years ago.

Your current pension is being paid for by your children and grandchildren's taxes ... not yours ... despite what you might believe.

Don't blame the government now for tightening the rules as the rules and the concept of the OAP were written in a different world, for a different age.

I think you also misunderstand my situation David.

At 64 I don't yet qualify for an OAP and obviously don't receive one.

I went to great pains to clarify the fact that I am receiving my own money back from my superannuation scheme. I don't know why people cannot understand the concept.

I have saved enough money during my working life (with the aid of employer contributions) to pay myself a stipend (pension) for life. It has nothing to do with CentreLink and their various pension schemes.

I am not a drain on the taxpayer!

However, because my employer was the Australian Government, my money is administered by a special superannuation fund protected by legislation. I am unable to gain access to this lump sum to re-invest into tax saving schemes.