Your guide to retiring overseas
07 June 2022
As international borders reopen and travel resumes, living overseas in retirement may again become an option you might consider.
Some research, such as the Global Retirement Index1 is devoted to crunching the financial, health, lifestyle and governance numbers to highlight where retirees might spend a lot less money, while getting a whole lot more in retirement experiences.
If you do decide to live overseas in retirement, there are a number of considerations to weigh up . Here are a few tips:
Retiring overseas and your super
The Australian Tax Office2 states there are a number of actions to consider as an Australian living overseas.
If you are an Australian citizen or permanent resident heading overseas, your super remains subject to the same rules, even if you are leaving Australia permanently. This means you cannot access your super until you reach preservation age and retire or satisfy another condition of release. If you have left Australia to live permanently in New Zealand, you may be eligible to transfer your QSuper funds to your KiwiSaver account via the Trans-Tasman Retirement Savings Portability Scheme.
Retiring overseas and your pension
You may get the Age Pension even when you’re living overseas. The Australian Government’s Services Australia3 explains how and when the pension is paid and the pension rates payable if you are outside Australia.
Your Age Pension payment rate may change when you leave Australia depending on your situation.
Any of the following circumstances can affect your payment rate:
- How long you’re away
- If your income and assets change
- How long you were an Australian resident between 16 and Age Pension age
- If you get Age Pension under a social security agreement with another country.
In most cases, your Age Pension won’t change if you leave Australia for less than six weeks.
But if you leave Australia for more than six weeks, changes that may impact you from the six-week mark include your Pension Supplement dropping to the basic rate and your Energy Supplement stopping.
Retiring overseas and tax implications
Leaving Australia to live overseas can have tax implications. The ATO explains the tax obligations for people living overseas depending on whether you remain an Australian resident or foreign resident.
If you are unsure of your tax situation before you leave, information on tax residency is available on the ATO website or you can speak to a tax professional.
If you remain an Australian resident, you must lodge an Australian tax return. If you work while overseas, you must declare:
- All your foreign employment income
- Any exempt income even if tax was withheld in the country where you earned it.
Retiring overseas and health care
Factor healthcare costs into your budget.
If you remain an Australian resident for tax purposes, you may be able to use publicly-funded medical services in countries with a reciprocal healthcare agreement. These are agreements with some countries where visitors can get publicly funded medically necessary care. These agreements vary from country to country, so research thoroughly with your personal healthcare requirements in mind. Generally, you’ll need to prove you’re from Australia and eligible for Medicare when you’re in another country.
In some countries places you may be able to access public healthcare for a minimal cost. You may also consider health insurance in your chosen country or international travel insurance through an Australian provider.
Your overseas retirement checklist
- ☐ Get the right visa
- ☐ Determine the impacts on your super
- ☐ Check your Age Pension entitlement
- ☐ Sort out your bank accounts
- ☐ Consider your tax status and the complexities of being an overseas resident or non-resident
- ☐ Choose the right property
- ☐ Decide on a medical expense plan
Support for your super and retirement
Professional financial advice on your QSuper account at no additional cost.4
1. International Living, 1 January 2022, The World’s best Places to Retire in 2022 at internationalliving.com
2. Australian Tax Office, 1 July 2021, Australians living overseas, accessed 25 May 2022 at ato.gov.au
3. Australian Government, Services Australia, 6 April 2022, Payments while outside Australia, accessed 25 May 2022, at servicesaustralia.gov.au
4. QInvest Limited (ABN 35 063 511 580, AFSL 238274) is a separate legal entity responsible for the financial services it provides. Eligibility conditions apply. Refer to the Financial Services Guide (pdf) for more information.