The chal­lenge: Maria Bekiaris

For a top deal, check the ex­change rate as well as the fee

Money Magazine Australia - - CONTENTS - THE CHAL­LENGE Maria Bekiaris

So you’ve sold an over­seas prop­erty or re­ceived an in­her­i­tance from some­one over­seas and you want to trans­fer the money to Aus­tralia – how do you do it? It’s a ques­tion Money gets a lot, par­tic­u­larly from UK ex­pats, which is why we will use that as our ex­am­ple.

Start by com­par­ing providers’ costs. Con­sider both the trans­fer fee and the ex­change rate as providers of­ten add a mark-up into the ex­change rate, says Mozo’s Kirsty La­mont. “When you are deal­ing with a large sum of money, even a dif­fer­ence of a few cents in the ex­change rate can make a huge im­pact on your fi­nal amount,” she says. “While most banks of­fer a money trans­fer ser­vice, it is usu­ally more cost-ef­fec­tive to opt for an in­ter­na­tional money spe­cial­ist if you’re trans­fer­ring a large amount of funds over­seas.”

Mozo’s num­ber crunch­ing found that to trans­fer £500,000 to Aus­tralia you would get the best deal from Com­pass Global Mar­kets – you’d get $895,704 af­ter trans­fer fees. XE and WorldFirst fol­lowed with $895,526 and $893,911. In com­par­i­son with NAB, which was of­fer­ing the best rate from the big banks on the day, you’d get just $862,357 – $33,347 less than the best of­fer!

No doubt en­sur­ing your money is safe is a ma­jor pri­or­ity. “Con­sumers should check that the in­ter­na­tional money trans­fer spe­cial­ist they’re con­sid­er­ing is li­censed in the UK and falls un­der the reg­u­la­tion of the Fi­nan­cial Con­duct Au­thor­ity (FCA),” says La­mont. If you use a com­pany that isn’t autho­rised, you may not be cov­ered by the dis­pute res­o­lu­tion ser­vices or com­pen­sa­tion scheme if a prob­lem arises, she adds.

Also ask about any trans­fer lim­its and trans­fer speeds.

Once you’ve cho­sen a provider you will need to cre­ate an ac­count. “You will need to go through a process of prov­ing your iden­tity. You should make sure the name on your bank ac­count also matches the name on your money trans­fer ac­count, oth­er­wise your trans­fer could get re­jected due to Eu­ro­pean reg­u­la­tions,” says La­mont.

Af­ter you have sup­plied the rel­e­vant de­tails you’ll need to pay for the trans­ac­tion and the provider will make the trans­fer.

Whether there are any tax im­pli­ca­tions de­pends on the un­der­ly­ing source of the money, says Mark Chap­man, from H&R Block. “So the sale of an over­seas prop­erty will give rise to a cap­i­tal gains tax li­a­bil­ity, money earned over­seas from for­eign em­ploy­ment will be taxed as in­come but in­her­i­tances and gifts will not (usu­ally) give rise to any Aus­tralian tax im­pli­ca­tions.”

Chap­man says the gov­ern­ment’s money mon­i­tor­ing ser­vice, AUSTRAC, will pick up large flows of money and re­port these to the ATO. So even if there is no tax­able trans­ac­tion, you may be asked about the money so it’s im­por­tant to have doc­u­men­ta­tion to prove the source.

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