Australia

{"ftc_utility":"high","fbar_trigger_notes":"Australian bank accounts - checking, savings, superannuation accounts (once a US person has signatory authority or ownership interest and the aggregate balance exceeds USD 10,000 at any point in the calendar year) must be reported on FinCEN 114 (FBAR). Australian superannuation accounts are a common compliance issue; the IRS and Treasury have acknowledged uncertainty around superannuation trust reporting under FBAR and FATCA Form 8938. Many practitioners report superannuation on FBAR out of caution. Australian banks are FATCA-compliant and report US account holders to the ATO, which shares data with the IRS under the intergovernmental agreement.","ftc_utility_reason":"Australia imposes relatively high income taxes (top marginal rate 45% plus 2% Medicare levy) on Australian-source and worldwide income for residents. US citizens who are Australian tax residents and do not elect the FEIE can use the Foreign Tax Credit to offset Australian tax paid against US tax liability. Because Australian rates frequently exceed US rates, the FTC often eliminates or substantially reduces US tax on the same income. The FTC is particularly useful for income above the FEIE exclusion ceiling (USD 126,500 for 2024) and for passive income such as dividends, interest, and capital gains where the FEIE does not apply.","presence_day_count_notes":"Australia grants various visa subclasses that allow extended stays. Most long-term residents hold permanent residency or work visas that do not restrict physical presence in a way that prevents the 330-day count. However, US citizens on short-term or temporary visas should confirm days outside the US carefully. Australia has no entry/exit stamp system, so passport records and travel logs are the primary documentation. Days count regardless of visa type under the physical presence test.","typical_qualifying_method":"either","housing_exclusion_available":true,"physical_presence_test_applies":true,"estimated_housing_exclusion_usd":18000,"local_tax_rate_on_earned_income":0.325,"bona_fide_residence_test_applies":true}

{"pension_income":{"notes":"Australian superannuation fund income in the accumulation phase is taxed at 15%. Superannuation pension payments from a taxed source to individuals aged 60 or over are tax-free in Australia. Payments to those aged under 60 are generally included in assessable income at marginal rates with a 15% tax offset. Foreign pension income received by Australian residents is generally assessable at marginal rates unless a treaty exempts it.","tax_rate":null,"locally_taxed":true},"social_security":{"notes":"Under Article 18 of the US-Australia tax treaty, US Social Security benefits paid to an Australian resident are generally taxable only in the US. The treaty prevents Australia from imposing its own tax on US Social Security income for Australian resident recipients. Australia and the US also have a Totalization Agreement that prevents double social security taxation and allows for benefit portability.","locally_taxed":false,"treaty_protection":true},"roth_distributions":{"notes":"Australia does not have an equivalent of the Roth IRA. Qualified Roth distributions that are tax-free in the US may still be assessable in Australia if the individual is an Australian tax resident, because Australia does not recognize the US tax-exempt status of a Roth IRA. The treaty Article 18 pension provisions may offer some relief but the ATO's position on Roth accounts is not codified by specific guidance, creating uncertainty. US expats in Australia holding Roth IRAs should seek specialist advice.","locally_taxed":true},"us_401k_ira_distributions":{"notes":"The US-Australia tax treaty (Article 18) generally provides that pensions and annuities are taxable only in the country of residence. As an Australian tax resident receiving US 401(k) or IRA distributions, the distributions are generally taxable in Australia at marginal rates and exempt from US tax under the treaty. However, treaty application to Roth vs traditional accounts and employer vs personal contributions can be complex. The ATO may treat distributions differently depending on structure. US citizens must still report to the IRS regardless of treaty position. The treaty does not fully resolve all classification issues, and individual rulings may be required.","tax_rate":null,"locally_taxed":true,"treaty_protection":true}}

{"rate":0.45,"notes":"Australia has no separate CGT rate. Capital gains are included in assessable income and taxed at the individual's marginal rate, up to 45%. Assets held for 12 months or more by individuals qualify for a 50% CGT discount, effectively capping the maximum rate at 22.5% on discounted gains.","details":{"tax_type":"Capital Gains Tax","country_name":"Australia","country_iso_code":"AUS","source_references":["PwC Worldwide Tax Summaries - Australia","Australian Taxation Office (ATO)"],"last_verified_date":"2026-06-03","general_description":"Capital gains are included in an individual's or company's assessable income and taxed at their applicable marginal rate. The CGT system was introduced in September 1985; assets acquired before 20 September 1985 are generally exempt. Individuals and trusts that hold an asset for at least 12 months before disposal are entitled to a 50% CGT discount on the net capital gain. Companies do not receive the 50% discount. The Medicare levy of 2% applies on top of the marginal rate. Foreign residents are taxable only on taxable Australian property (TAP), which includes real property, business assets, and indirect interests in Australian real property.","corporate_capital_gains":{"rate":0.3,"notes":"Base-rate entity rate of 25% applies from the 2021-22 income year onward for eligible small companies.","reduced_rate":0.25,"tax_treatment":"Included in ordinary income and taxed at the corporate rate - 30% for large companies, 25% for base-rate entities (aggregated turnover below AUD 50 million). No 50% discount applies to companies."},"individual_capital_gains":{"rate":0.45,"notes":"Maximum effective rate including 2% Medicare levy on discounted gain is 23.5% (45% x 50% + 2%). Non-residents are not entitled to the 50% CGT discount on assets acquired after 8 May 2012.","medicare_levy":0.02,"tax_treatment":"Included in assessable income at marginal rates up to 45% plus 2% Medicare levy. A 50% discount applies to gains on assets held 12 months or more, effectively halving the taxable gain before applying the marginal rate.","discounted_rate":0.225,"discount_eligible":true,"discount_percentage":0.5,"minimum_holding_period_months":12,"effective_max_rate_with_discount":0.235}}}

{"notes":"Australia operates a dividend imputation (franking) system. Resident individuals include dividends in assessable income at their marginal rate, but receive a franking credit offset equal to the corporate tax already paid on the underlying profits. If franking credits exceed the tax liability, the excess is refunded. Non-resident withholding tax is 30% on unfranked dividends, reduced to 15% under most tax treaties (e.g. the US-Australia treaty). Fully franked dividends paid to non-residents are generally not subject to dividend withholding tax. The Medicare levy of 2% applies on dividends received by residents.","rates":[{"rate":0.45,"type":"progressive","notes":"Resident individuals: dividend included in assessable income at marginal rates up to 45% plus 2% Medicare levy, with franking credit offset reducing effective tax burden."},{"rate":0.3,"type":"withholding","notes":"Non-resident withholding on unfranked dividends - domestic rate."},{"rate":0.15,"type":"withholding","notes":"Non-resident withholding on unfranked dividends - reduced rate under the US-Australia tax treaty and most Australian tax treaties."},{"rate":0,"type":"exempt","notes":"Fully franked dividends paid to non-residents are exempt from dividend withholding tax under Australian domestic law."}]}