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Re: Interest Accrued in Term Deposit

Devotee

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Replies 2

Hi please assist if possible 

 

If there is a term deposit on which interest is accrued but is only paid in cash upon its maturity in 5 years , should interest only be recognised as income in the personal return upon maturity or recognised in each year as it is accrued. ?

 

This is a foreign term deposit and tax is withheld in the foreign country on an yearly basis.

 

Thank you

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Most helpful response

ATO Community Support

Replies 1

Hello @Joachim

 

Income needs to be declared in Australia when it is paid, therefore if your interest is only paid at maturity, you would declare it in the financial year the maturity date falls under.

 

If you have already paid foreign tax on the interest, you may be able to claim a foreign income tax offset to relieve double taxation.

 

For more information, I recommend looking at the following:

 

TonyATO

2 REPLIES 2

Most helpful response

ATO Community Support

Replies 1

Hello @Joachim

 

Income needs to be declared in Australia when it is paid, therefore if your interest is only paid at maturity, you would declare it in the financial year the maturity date falls under.

 

If you have already paid foreign tax on the interest, you may be able to claim a foreign income tax offset to relieve double taxation.

 

For more information, I recommend looking at the following:

 

TonyATO

Devotee

Replies 0

Hi @TonyATO Thanks a lot