Expat life has many perks, but transferring money between countries isn’t always one of them. One way or another, you’ll get whacked with fees. Some options are cheaper than others, however, so it’s worth knowing about these.
The first piece of advice most expats receive about transferring money is this: don’t use an Australian bank, an overseas bank or an international bank. Here’s why:
- Banks charge high fees for international money transfers, some of which are hidden. Also, the bank from which you transfer money will charge fees and the bank into which you transfer money will charge fees. In other words, you’ll get slugged twice
- Banks mark up exchange rates to earn more money for themselves
- A bank to bank transfer may take days to process
- Advice from banks about international money transfers is usually average because they’re not specialists in the field
Foreign exchange services
These days, there are many dedicated online foreign exchange services. The good ones do many things better than banks when it comes to transferring money internationally. Some key advantages that they offer are:
- Lower fees
- Fewer hidden fees
- Competitive exchange rates
- Specialist knowledge of the foreign exchange market
- Quick transfers – usually within 2 days
- Secure transfers
- Special offers – watch out for these. Fees may be waived if you meet certain conditions
It’s easy to shop around for a good deal on this kind of money transfer, thanks to the existence of comparison websites. Here at Expat Tax Services, we use and recommend TransferWise as the costs are very reasonable in our opinion, especially when compared to the ridiculous costs charged by banks.
Respect the law
Never transfer money to evade taxes. The Australian Tax Office notes on its website that: “Revenue collection agencies around the world are increasingly sharing intelligence and expertise in financial investigations in the fight against tax evasion and organised crime.”
Indeed, if an individual is found guilty of tax crime in Australia, the courts can impose fines and other financial penalties and, in some cases, prison sentences.
Professional taxation advice
If you want to be doubly sure that you have correctly declared your income on your Australian tax return, get professional taxation advice. At Expat Tax Services, we provide advice on a range of taxation issues that affect expats.
Contact us today to book an appointment. We’ll make sure your international money transfers are legal from a tax perspective.