Maintaining your finances after you move

The financial considerations of an international move don’t just stop the minute the property is purchased. Here we outline the key financial considerations for after you purchase.

There are a number of important financial considerations you’ll have to plan for when moving to Australia, both before and after your property purchase is complete.

Tax planning

One of the first things you need to do before leaving the UK is to inform HMRC of your departure and determine your UK residency status using the Statutory Residence Test. This remains the starting point for understanding how your UK income and assets will be taxed once you move to Australia.

One of the first things you need to do before leaving the UK is to inform HMRC of your departure.

If you decide to continue paying into your UK pension plan while in Australia you may find that you’ll receive tax relief. When moving to Australia and bringing your UK pension with you, either in a lump sum or through regular payments, be aware of the foreign tax restrictions that will apply to this income.

It’s also important to be aware that the UK is moving away from a domicile-based tax system. From 6th April 2025, tax treatment will be based largely on residence rather than domicile, which could affect how long-term expats are treated for inheritance tax. This is particularly relevant if you plan to keep significant assets in the UK. A specialist adviser can help you understand how the new rules apply to your circumstances.

If you earn income in Australia, Australian tax law will apply. However, if you move on a temporary visa, such as a 482 or 408, you may be classed as a temporary resident for tax purposes. In many cases, temporary residents are exempt from Australian tax on most foreign-source income, including UK dividends and rental income. This can offer a useful window of tax relief, but the rules are specific and advice is essential.

If you plan to rent out property in either country, or draw income from investments or pensions, speak to an adviser who understands both UK and Australian tax systems. Cross-border tax planning is not an area where assumptions pay off.

Claiming your pension

If you’re entitled to the UK State Pension, you can still receive it while living in Australia, but there’s an important detail to be aware of. The UK State Pension is frozen at the rate it’s first paid once you’re resident in Australia. Unlike pensions paid in the UK, it does not receive annual increases under the triple lock, which can make a significant difference over time.

You can choose to receive your pension into a UK account and transfer it to Australia. Setting up regular payments to your Australian account is a good way to ensure a steady stream of money is available. Working with a payment specialist is the easiest and most effective way of setting up a payment system while in Australia. By setting up a Regular Payment Plan with Smart Currency Exchange you will receive your pension in regular payments at pre-agreed exchange rates and for no service fees. It doesn’t get any easier than this.Using a currency specialist to set up regular payments can help you manage exchange rates and plan your monthly income more confidently.

Australia treats UK pension income as foreign income, which means it may be taxable. The UK–Australia double taxation agreement is designed to prevent the same income being taxed twice, but how this applies depends on the type of pension and how you receive it.

Some people explore transferring their UK pension into an Australian superannuation scheme through a qualifying recognised overseas pension scheme arrangement. This is only possible once you are at least 55, due to HMRC rules, and there are additional tax considerations to factor in.

Since April 2024, the UK Lifetime Allowance has been abolished and replaced by the Overseas Transfer Allowance, currently set at £1,073,100. Pension transfers above this level may still trigger a 25% tax charge.

Another key point is how Australia taxes pension growth. Australia may tax the growth in your pension fund between the date you become an Australian resident and the date you transfer the pension. If the transfer takes place within six months of becoming resident, this tax is often avoided. Miss that window and the tax bill can be substantial, so timing matters.

Working with a currency specialist will save you worrying about getting money to Australia when you need it.

Ensure you consider the taxes that may be placed on your pension income. Australia considers your UK pension foreign income, meaning you may be taxed on it. Tax treaties between Australia and the UK have been signed to avoid foreign income being taxed by both countries. You can learn more about this on the Australian Tax Office website.

Some retirees and retirement savers opt to invest their pension in a Qualifying Recognised Overseas Pension Scheme (QROPS) or a Self Invested Personal Pension. It is always best to consult a professional financial adviser when making decisions about your pension and retirement savings.

Living costs

Have you considered how much money you will need to live in Australia? This will depend on many factors such as where you’ll be living, who you’ll be supporting and the standard of living that you expect. It is important to have a realistic expectation of living costs and budget accordingly.

Letting your property

Australia’s rules for foreign buyers have tightened considerably. From 1st April 2025 until 31st March 2027, foreign persons, including temporary residents, are generally prohibited from buying established dwellings altogether. This applies even if you plan to live in the property as your main home. During this period, foreign buyers are largely limited to purchasing new-build properties.

From 1st April 2025 until 31st March 2027, foreign buyers are largely limited to purchasing new-build properties

If you are eligible to buy, you should also budget carefully for upfront costs. Bear in mind that Foreign Investment Review Board application fees have increased: for residential property priced under AU$1 million, the fee is now over AU$40,000.

On top of this, most Australian states charge a foreign person surcharge on stamp duty. This is typically an additional 8-9% on top of standard stamp duty rates.

If you decide to let your Australian property you can choose to do so through a property management company (for a fee), or do it yourself either locally or via websites like Airbnb. The advantages of letting through a property management service is they take responsibility for finding suitable tenants and will address any maintenance or emergency issues in your home. Websites like Airbnb may provide better returns but create a lot more work for you the homeowner.

Due to the high cost of homes in Australia, rental yields are generally low compared to more affordable places. Ensuring your property is adequately insured for home and contents is important, and you may want to consider landlord or renter’s insurance.

Rental income must usually be declared to The Australia Tax Office, although allowable deductions can reduce the taxable amount. As with all cross-border income, getting advice from a financial adviser before you commit can save you from expensive surprises later.