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Re: Tax treatment of Australian Super Fund in Germany

Newbie

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Replies 4

Hello,

 

I am an Australian citizen working and living fuil time in Germany for a German employer. I am currently a non-resident for Australian tax purposes. I am trying to understand my German Tax obligations as they apply to my Australian super fund while working in Germany both in accumulation and retirement (maybe I retire here, but that's 20+ years away). I anticipate in retirement I would convert my super into an income stream rather than an annuity.

 

This should be covered by the bilateral tax agreement between AU and DE. Unfortunately, the treaty does not explicitly deal with super, however I have found a reference to super in an explanatory memorandum from the Australian parliament here (parlinfo) which states:

 

1.108 While there is no specific rule in Article 4 (Resident) addressing the residence of Australian superannuation funds, during negotiations the delegations agreed that:

‘an Australian superannuation fund would be regarded as a resident of Australia, notwithstanding that the trustee of such a fund is responsible for the fund’s tax obligations under Australia’s domestic law.’

 

1.109This accords with Australia’s understanding of how the Resident Articles in Australia’s bilateral tax treaties would generally apply to Australian superannuation funds.

 

i have consulted a tax accountant in Germany, but they could only make guesses and assumptions as to how super will be treated in Germany (there is no direct German equivalent).

 

Can anyone provide advice on how AU super funds are treated in Germany according to the treaty, both in the accumulation phase and in retirement? Does the above text referencing "the fund is resident of Australia" mean that Germany will not tax it at any stage?

 

Any help would be greatly appreciated, I have no idea where else to get binding advice.

 

Cheers.

 

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Most helpful response

ATO Community Support

Replies 2

Hi @supergermany

 

You advised you are currently a non resident of Australia working overseas for an overseas employer. If you are not accessing your super yet I'm not sure how that would impact your tax obligations in Germany. 

 

Regardless of when you access your super, you would need to meet a condition of release. Eligibility requirements are listed on our website. You may also have reporting requirements in Australia depending on your age, the condition of release under which you accessed it and the taxable components of your super balance.

 

If you have an obligation to pay tax overseas then you may advise us by reporting a foreign income tax offset. Your obligation to pay tax on super here will be relevant to the way you access it. Paying tax overseas on it is something you will need to discuss with your relevant government department.

 

Please use the links provided for further assistance.

 

Links -

Early access to your super.

Accessing super upon retirement.

Super and tax

Foreign income tax offset.

 

All the best.

4 REPLIES 4

Most helpful response

ATO Community Support

Replies 2

Hi @supergermany

 

You advised you are currently a non resident of Australia working overseas for an overseas employer. If you are not accessing your super yet I'm not sure how that would impact your tax obligations in Germany. 

 

Regardless of when you access your super, you would need to meet a condition of release. Eligibility requirements are listed on our website. You may also have reporting requirements in Australia depending on your age, the condition of release under which you accessed it and the taxable components of your super balance.

 

If you have an obligation to pay tax overseas then you may advise us by reporting a foreign income tax offset. Your obligation to pay tax on super here will be relevant to the way you access it. Paying tax overseas on it is something you will need to discuss with your relevant government department.

 

Please use the links provided for further assistance.

 

Links -

Early access to your super.

Accessing super upon retirement.

Super and tax

Foreign income tax offset.

 

All the best.

Newbie

Replies 0

Hello Jodie,

 

Thanks for the reply. I'm trying to plan ahead for the future, you're right there's not much change for the moment in accumulation phase.

 

Thanks again for the quick reply, i'll search for answers in germany.

 

best

Supergermany

I'm new

Replies 0

Hi Jodie,

may I please tag on to this conversation with a similar question:

- I am also living and working in Germany. And I plan to retire in Germany

- I am a non-resident and have no income in Australia

- my super-fund is all taxable

- I plan to withdraw my super funds when turning 65 (probably a few lump sum withdrawals over the course of a few years)

- I am aware that I have to list Australian Super-fund withdrawals as income in my German tax declaration

 

Question:

- based on my understanding of the tax treaty between Australia and Germany, I assume my Super withdrawals after 65 will not be taxed in Australia (irrespective of lump sum or regular payment stream)

- I assume I will not have to lodge a tax return (as I have no other income)

- I am not sure if the topic of foreign income tax offset applies to me

 

Many thanks in advance for your advice.

 

Have a good day and greetings from Germany

ATO Community Support

Replies 0

Hi @EPICSW

 

Generally an Australian tax return is required where your Super has a taxable component with an untaxed element.. If this will be the case for you then you may be eligible for the foreign income tax offset in your tax return to relieve you from double taxation.

 

On the other hand, if your super doesn't contain an untaxed element, then you won't need to declare your super payments on an Australian tax return

 

See our website about accessing your Super if you're 60 old or older.