Hi there,
I have the Australian citizenship, I am going to receive inheritance money and was wondering if this money will be taxed because it is coming from a country in Europe. I am planning to give some of this money to my son as a gift, and I know my Australian pension might be cancelled .
With the money left, what is the best option not to pay taxes on it.? spend it all!!?
Irrespective of from where the money originates, @bougnat2221 , Australia does not impose estate or inheritance taxes on money received but you may subsequently pay taxes on bank interest or investment earnings. See the following ATO page for details.
If you are a beneficiary of a deceased estate | Australian Taxation Office
In terms of not paying taxes on it, perhaps you should speak with a financial advisor? For example, and depending on your age and current superannuation balance, you might wish to make concessional contributions to super.
You are correct, however, to assume that your increased assets after inheritance may affect your Australian pension, but don't assume that giving it away immediately after you've received it will make a difference. You should speak with the Department of Social Services (a.k.a. Centrelink) rather than the ATO to ensure you achieve the best possible outcome. For example, consider the following Services Australia page about "gifting" so you understand whether or not it will make a difference.
Gifting - Age Pension - Services Australia
You are right that it might affect your pension (I assume aged pension?). However to the extent that the money goes into your home (or an upgraded home!) the money doesn't count as an asset for aged pension purposes. Depending how old you are, if it is invested in your super fund the earnings on it will likely be tax free - but you would need to speak to a financial advisor about the best strategies for you and how much you can get into your super fund will depend on your age and current super balance. Often super funds offer a free appointment with a financial advisor in relation to strategies around putting money into super which may help.
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