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Re: Claims / Tax on Super under a 482 Visa

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I had a query with regards to Super that I was hoping you could assist with.
 
When I first arrived in Australia in 2017 on a Working Holiday Visa, I created a super fund when joining my current employer. I eventually switched to a 482 Visa in 2018.
 
From what I understand, If I choose to leave Australia in the future, all of the super I have earned to date will be taxed at the Working Holiday rate of 65%, which is naturally quite alarming.
 
Can I avoid this by simply opening a second fund and transferring what I had earned on the 482 Visa? Some of the existing threads on here seem to indicate this might be the case.


Any Advice would be greatly appreciated.

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Hi @UK-M-482-Visa

 

Thanks for your question.

 

Your understanding about how a future departing Australia super payment (DASP) will be taxed is correct. Your current super fund will be obliged to apply the 65% tax rate to the entire DASP even though only some of it relates to contributions made when you held a working holiday maker (WHM) visa.

 

For more information about DASP for working holiday makers, have a look at our website.

 

You won't be able to avoid paying the 65% tax rate on your non-WHM contributions by transferring your non-WHM contributions to another super fund. This is because your new super fund won't know that they are non-WHM contributions.

 

When your current super fund arranges the rollover (assuming they are happy to arrange a partial rollover), they will be required to provide a statement to your new super fund. Amongst other things, that statement will detail the tax components and the service period start date but not the contribution types or dates.

 

For more information about what your super fund will need to do, check out the reporting to receiving funds and members page.

 

When your second fund receives your future DASP application, they won't know the specifics of the contributions received by your first fund but they will know the service period start date. The Department of Home Affairs will also confirm when you were the holder of a WHM visa. You can probably see where this is going.

 

While you can't avoid the 65% tax rate on the contributions that have been made so far, assuming that you remain on a non-WHM visa, any future contributions made into an account with a different super fund will be taxed at the lower rate/s.

 

Hope this helps.

 

Thanks,

 

ChrisR

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Hi @UK-M-482-Visa

 

Thanks for your question.

 

Your understanding about how a future departing Australia super payment (DASP) will be taxed is correct. Your current super fund will be obliged to apply the 65% tax rate to the entire DASP even though only some of it relates to contributions made when you held a working holiday maker (WHM) visa.

 

For more information about DASP for working holiday makers, have a look at our website.

 

You won't be able to avoid paying the 65% tax rate on your non-WHM contributions by transferring your non-WHM contributions to another super fund. This is because your new super fund won't know that they are non-WHM contributions.

 

When your current super fund arranges the rollover (assuming they are happy to arrange a partial rollover), they will be required to provide a statement to your new super fund. Amongst other things, that statement will detail the tax components and the service period start date but not the contribution types or dates.

 

For more information about what your super fund will need to do, check out the reporting to receiving funds and members page.

 

When your second fund receives your future DASP application, they won't know the specifics of the contributions received by your first fund but they will know the service period start date. The Department of Home Affairs will also confirm when you were the holder of a WHM visa. You can probably see where this is going.

 

While you can't avoid the 65% tax rate on the contributions that have been made so far, assuming that you remain on a non-WHM visa, any future contributions made into an account with a different super fund will be taxed at the lower rate/s.

 

Hope this helps.

 

Thanks,

 

ChrisR

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Hi Chris,

 

Thanks so much for your response, its quite stressful when this information isnt made entirely clear on the government site.

 

Still a little confused however. I understand that transferring non WH contributions will result in me still paying 65%.

 

But If I simply open a new super fund with a different provider and do not transfer anything, will that result in me paying the lower rate from that point forward?

 

At this stage i'm just looking for directions on how to pay the lower rate from now on, with future contrubitions

 

Any additonal advice you can offer would be greatly appreciated.

 

Many Thanks,

Elliot 

 

ATO Certified Response

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Hi @UK-M-482-Visa

 

Thanks for your reply.

 

If you end up having accounts with two super funds, the DASP tax rate will be determined by each super fund separately, as each super fund is making their own payment. In turn, you will receive two DASPs.

 

Based on your scenario, your older super account will hold contributions that are attributable to when you held a WHM visa. This means that your older super fund will need to withhold the 65% DASP WHM rate from your payment.

 

Assuming that you don't rollover any of the super from your older super account into your new super account and you remain on a non-WHM visa, the lesser DASP tax rates will apply to any DASP paid from your new account.

 

For more information about how DASP is taxed, you can check out our website.

 

Hope this helps.

 

Thanks,

 

ChrisR