What happens to your taxes when you move abroad?

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At any given time, there are around one million Australians living and working overseas. And we’re not talking about your six-month trip to Europe where you were paid 50 euros a week (in cash) to work in a hostel – most of these people have jobs, bank accounts, health insurance, everything.

Some of these relocations were planned, others spontaneous. Some may want to return to work in Australia, others may never. Regardless, everyone will have to answer the question: what do I do with my house and my super and paying taxes and stuff?

If you're thinking about moving abroad, talk to a tax agent to understand the intricacies. — If you’re thinking about moving abroad, talk to a tax agent to understand the intricacies.Credit: michael howard

Okay, they probably don’t ask exactly that, but questions like taxes, retirement and property are common questions for anyone thinking about living and working abroad. It can be difficult to know what the best move is, especially if you’re not sure when/if you’ll return.

What’s the problem?

Compounding this problem is the absurd number of rules and various tests that the tax administration applies when trying to determine your tax residency. A quick look at the ATO’s online information lists four different tests used to determine whether someone is liable to pay tax in Australia.

And although it may seem like a choice you do, is usually not the case, warns tax agent and director of BANTACS, Julia Hartman. Often the decision is made based on “the balance of the particular facts of your case,” she says, and it can be far from a dry and straightforward decision.