Offshore Term Deposits - A poor deal for Australian expats and offshore investors
Australian banks consistently offer poor value to Australian expatriates and foreign investors wanting to place cash in Australian dollar term deposits and at call accounts. The rates in the Australian domestic market continue to provide much better returns on your money, evening having regard to the
The results of the OECD's first international survey of adult skills shows that Australian adults perform very well compared to other developed countries when it comes to literacy skills, but when it comes to numeracy the performance is only average.
Recent RBA recent have seen Australian interest rates fall to their lowest levels since 1959. Typically, Australian expatriates once overseas rarely review their mortgage arrangements; usually on the presumption that is just too much of a hassle, or that somehow the changes will be reflected in their mortgage payments.
We now have a Federal election scheduled for Saturday, September 7, 2013 and unfortunately the rules and regulations surrounding voting overseas continue to make it difficult or impossible for Australians to maintain their ability to vote. This is completely contrary to the position regarding tax residency, where it is becoming increasingly difficult to escape the clutches of the ATO.
The chart below, borrowed from our sister site Exfin, looks at how the Australian dollar has performed against 4 major currencies - the USD, GBP, Euro and JPY - over the past two months to the end of July, 2013.
Australia has one of the highest penetrations of smartphone users in the world and individuals going overseas risk extreme "budget shock" if they allow their phones to keep them automatically updated about the weather, news and sporting results, much less using them for web browsing, email and video viewing.
Over three years ago the current Australian Federal Government decided to withdraw the tax exemption available under section 23AG of the Tax Act in relation to the income earned by Australian residents overseas, if they met certain conditions. It was a monumentally stupid thing to do, and that remains the case.
Despite the AUD being at 4 month lows amongst most major currencies as this article is written, Sterling has continued it's poor performance against the Australian dollar into 2013 and is at nearly 30 year lows. The chart below shows monthly average exchange rates over the last 20 years - with the AUD continuing to trend well above the long-term "average" rate.
We seem to have a Government as present which, when faced with a fork in the road always decides to take the "wrong one". Consequently, facing a Budget blow out of very significant proportions (too much spending and too little "mining tax" revenue") they decided to focus of the "Cookie Jar", which is every right minded politician's view of superannuation.