I see this a lot. Rich people living in the Bahamas or Monaco places like that e.g. Actors/sport stars. But how can they keep there Australian citizenship, if they become a citizen of say Bahamas or Monaco? Pat Rafter did that, he became a citizen of Bermuda for tax-purposes. How can they dodge paying income tax in OZ? And same applies to other western countries. It confuses me. If your income has been earned in many different countries e.g. golf-tennis player, who determines which country you pay the income-tax in? Your new country of residence or your country of birth, etc?
NSW Taxes and Australian Citizenship of Celebrities
- Thread starter Steve500
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In such situations, there are two sets of law in play - the law of Australia, and the law of the country where the person is.
Understand that in Australia, citizenship and liability to pay tax are legally separate.
There are many Australian Citizens who do not pay any tax in Australia, because they don't earn enough,
just as there are many, many non-citizen taxpayers.
There is a concept in tax law in Australia called domicile. Read about it here.
As to your question of how a person gets to keep their Australian Citizenship,
the answer simply is that Australia allows its citizens to hold dual nationality.
An Australian does not lose their citizenship by mere fact of living overseas on an ongoing basis.
Understand that in Australia, citizenship and liability to pay tax are legally separate.
There are many Australian Citizens who do not pay any tax in Australia, because they don't earn enough,
just as there are many, many non-citizen taxpayers.
There is a concept in tax law in Australia called domicile. Read about it here.
As to your question of how a person gets to keep their Australian Citizenship,
the answer simply is that Australia allows its citizens to hold dual nationality.
An Australian does not lose their citizenship by mere fact of living overseas on an ongoing basis.
Tim W
Thanks for that, some good points you make. The point of that leading forward is, who determines if you have dual-citzenship where you pay tax if your earning enough to be deemed eligible to pay tax. If you have earned money in multiple countries e.g. "Golf/Tennis prize money", would you then choose where you do your yearly income-tax declaration e.g. Australia or Monaco?
Or if say you earn the majority of your money in Australia e.g. "500K in by end of financial year", would you still be able to pay your income-tax in Monaco under Monaco income-tax rates?
Tim I read your Domicale post, after my last post. That answers my above Australia/Monaco Case-study hypothetical.
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