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Legal requirements and laws for transferring large sums of money to Australia

What you should know when sending large sums to Australia.

Transferring your life savings ahead of moving overseas, funding a business opportunity or inheriting money from family abroad? Before you move your money out of Canada, use our handy guide to get up to speed on the Australian legal and reporting requirements that go along with receiving large transfers in the land down under.

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Do I have to report large transfers into Australia?

If you’re sending more than $10,000 or a foreign currency equivalent to family and friends in Australia, they could be on the hook for taxes regulated by the Australian Taxation Office. The following large money transfers are often not subjected to Australia’s taxation laws:

  • One-time gift. Money transfers that are seen as one-off gifts or rewards aren’t taxed, but there are instances where they can be. This includes if the money is part of a business-like activity or if it’s related to how you earn income. If you decide to invest this gift money, the income it generates can be taxed.
  • Inheritance. If you’re a beneficiary, you won’t need to pay taxes on the inheritance money you receive from abroad. If you choose to invest this money, the interest may be taxable and should be reported on your income tax forms.
  • Money you bring with you if you’re moving to Australia. If it’s more than AUD$10,000 or a foreign equivalent, you’ll need to declare it to customs.

If you’re sending a large sum of money to take advantage of an investment opportunity — for example, to invest in a business or property — you’re required to report the amount as foreign investment income to the Australian Taxation Office. You may be required to pay tax on this money, depending on your specific circumstances.

For example, if you have an investment property overseas and receive the rent via money transfer, you’ll need to pay tax on it. But if the money you receive is a birthday gift from someone living overseas, you typically won’t need to pay tax. If you’re concerned about a large inheritance of money or property, speak to a tax professional to make sure that you comply with Australia’s taxation regulations.

What are the penalties for not declaring a large remittance?

If your loved ones in Australia receive a large money transfer that’s not exempt from tax and they choose not to pay, they risk fines and other penalties. More serious consequences include criminal convictions and even prison sentences.

Criminal convictions can affect your employment and ability to travel outside the country. Encourage your friends and family to report any large money transfers on their annual tax returns to the Australian Taxation Office. Or ask them to speak to a tax professional for guidance.

To avoid the severe penalties that come with a failure to report large sums of money being brought into the country, speak with a professional to guarantee that everything is above board and complies with the laws of all countries involved.

How will my recipient receive my remittance in Australia?

Sending money through a bank or money transfer specialist makes for easy and convenient bank deposits or cash pickups. In general, you may need to provide photo ID or a transaction number to receive your money transfer in person.

If you already have an account with the bank or money transfer company, you may not need to provide ID each time you receive money. However, online money transfers may have stricter rules when it comes to proof of ID, and they could ask for additional documentation or ask you to verify your identity by phone.

As with all international money transfers, be wary of potential fraud and only send money to people you know. Use a reputable provider to help protect your money from potential scams.

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