How is an US Individual Retirement Account Taxed/401K .

 Author: rajza789(Newbie)Newbie

23 Feb 2025

Hello Kylie.

Thank you for your response. However I am not sure I agree that my question requires engaging the early engagement team. If you look at the threads

https://community.ato.gov.au/s/question/a0JRF000002pMrl2AE/p00356178?referrer=a0N9s000000Dac8EAC

and

https://community.ato.gov.au/s/question/a0JRF000000gqbh2AA/p00271880?referrer=a0N9s000000DacCEAS

and

https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/foreign-super-funds/withdraw-a-lump-sum-directly-from-a-foreign-super-fund#Applicablefundearnings

we are all asking the same question. It seems from the last link that the answer is that the interest we earn since we became Australian Tax Residents is taxable. A cut and paste from the last link if exactly what I was asking, although I may not have asked it correctly:

Example: applicable fund earnings and becoming an Australian resident

In June 2015, Hassan left Australia and worked overseas. During this time, he contributed to a foreign super fund. In July 2018, Hassan returned to Australia and immediately again became an Australian resident for tax purposes. At this time, his foreign super interest was valued at $12,000.

In February 2019, Hassan decided to transfer the balance of his foreign super fund to himself. The value of his super interest was then $13,500, of which $1,500 was earned since he became an Australian resident. The $1,500 represents applicable fund earnings that Hassan is required to declare in his tax return. He does not have to include the $12,000 in his assessable income.

Any thoughts on this?

Reply0 likes

• Report as inappropriate