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I am in the process of relocating from the US to Australia.

Customer Question

I am a dual citizen...

I am in the process of relocating from the US to Australia. I am a dual citizen. I have my personal banking details sorted out, however I am interested in establishing an account for my business in Australia. The business is a US C Corporation and the
establishment of the account in Australia is purely for convenience in managing affairs of the business. As I understand it, I would need to "register" the business with Australia to get a "ID" to permit the opening of the account. With doing this, would the
Corporation then be subject to Australian taxes? I understand there is a tax applied to interest earned on the account as a registered foreign entity, beyond that would there be any additional taxes or filing requirements that the business would be subject
to should I open an account in Australia?

Submitted: 7 years ago.Category: Australia Law

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Answered in 5 hours by:

10/21/2015

Solicitor: Leon, Solicitor replied 7 years ago

Leon, Solicitor

Category: Australia Law

Satisfied Customers: 52,712

Experience: BEc Dip Ed, Dip Law (SAB) MTax (UNSW)

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Good Morning

My name is ***** ***** I am a NSW Solicitor. Thank you for your question, and will do my best to assist you with your question. Please understand this is not legal advise Please understand this is not legal advise but a guide to assist you.

You will need an Australian Company but the issue is you need someone here to be a director or the company cannot exist.

You would be taxed as a foreign entity and any dividends distrbuted would be taxed as a foreign taxes.

Any income that is earned in Australia would also be taxed here but there is a tax agreement with the US and you would get credit in the US for any AU tax paid.

I hope this makes sense?

Customer reply replied 7 years ago

I believe it does make sense, income generated outside Australia but deposited into the Australia homed account(s) would not be taxable. Income generated within Australia would be taxable as foreign entity dividends? So then it sounds as if registering the corporation within Australia wouldn't be a bad thing given that taxes are only applicable on revenue earned within Australia. Is my understanding of what you shared accurate?

Solicitor: Leon, Solicitor replied 7 years ago

Good Afternoon

If it is income earned by the entity it would be taxed no matter where it is earned. In Australia worldwide income is taxed. But when you do the income tax return here you would disclose the foreign taxes you paid and get a credit for them.

You would have to disclose all income here of the entity and pay taxes on it.

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