When you have moved overseas and become an expat, discovering a whole new world is very exciting. You can enjoy personal growth, as well as do well financially. But as a new expat, you need to make sure that you know everything about tax. Just like at home, you are going to have responsibilities and it is imperative that you are aware of them in advance. After all, you are going to be paying the right amount of tax and making sure it is paid on time. The last thing you want is to be penalized when it could have been avoided. So, here is our tax planning guide for new expats.
Learn About Local Tax
The first step is going to be learning about the local tax system. It doesn’t matter where you move to, everywhere is going to have its own rules when it comes to tax. Thus, you will need to know whether you are eligible to pay the local tax and what exactly the regulations say for expats. Thus, you will need to consider what your status is and if you are liable for tax in your new country. This is all going to depend on your individual circumstances.
In particular, one thing you are going to need to find out about is whether there is a double tax treaty. Often, a country will agree with another country that any expats will not pay double when it comes to tax. Thus, this is a treaty you want and it is going to mean that you are not liable for tax in two different places. If you are liable for this, you need to find out so that you are paying the correct amount every year.
Start a Pension
A lot of people are not aware of the fact that a pension can help you pay less tax. Not only are you paying out less on tax but you are also preparing for your future. Therefore, you can enjoy two benefits in one. In particular, there are certain types of overseas pension that are going to avoid charges if you already have a pension and want to transfer it. Therefore, start to learn about pensions for expats and make sure that you choose one that is going to offer you a lot of advantages.
There is Financial Advice Available
Do not forget that there are professionals out there that can help you. Tax planning can get complicated especially if you are not used to dealing with it. Moving abroad to a new country is quite the adjustment. You will have a new environment to get used to and you might find it hard to learn everything at once. Therefore, do not forget that there is financial advice available. You can use a professional’s expertise to make the right decisions for you and so that you are being tax efficient. After all, becoming an expat is supposed to be fun. So, leave all the hard work to someone else.