INTHEBLACK July 2022 - Magazine - Page 51
DISTANT
HORIZONS
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if someone is being hired by a local company, they
may not have done the groundwork. For businesses
that don’t have a corporate structure in another
country, there are exposures for their firm if they
allow their employees to work in those countries. The
employees need to have very clear guidelines given to
them by their employer’s tax accountants; otherwise
that employer will be exposed,” Kayahan says.
Kayahan also advises both employers and employees
to do their research when considering relocating.
“One of the first things I do is encourage people
to see an accountant to discuss their tax situation in
terms of where they’ve been and where they’re going.
You need to be clear on residency status and what
your obligations are for paying tax on property and
other assets or income streams, for example.”
to CPA Australia’s
podcast on remote
working featuring
Kris Fothergill FCPA
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TO LISTEN
to this story as
an audiocast
Kris Fothergill FCPA is an
old hand at working
outside of Australia, and
has some advice to share
with anyone considering
relocating to another
country, or in his case, the
high seas.
In 2019, Fothergill, along
with his wife and four
children packed up their
home in Queensland and
literally set sail for a
long-planned sabbatical
aboard a 51-foot Dufour
Gib Sea yacht.
Three years later they’ve
just sailed into New York,
after waiting out COVID-19
off the coast of New
Zealand and then Fiji,
before making their way
through Central America
and up to Canada to stay
ahead of the hurricanes
that gather over the
Caribbean from June to
October.
Throughout the
adventure, Fothergill has
continued to run his
accounting firm DIAGNO
Accountants from the
yacht. It is fair to say the
sabbatical has worked out
very well so far, he says,
and that is largely down to
having an “awesome
team” on the ground in
Australia.
Fothergill also says
there are some crucial
steps to take before
uprooting your life and
transplanting it for any
period.
“Accountants and
lawyers can help with
people planning to work
elsewhere. They can ask
the important questions:
Do you plan to return to
Australia? How long are
you planning to be out of
the country for? Are you
still registered to vote? Do
you still have private
healthcare? Where’s your
mail going? Where will
you be paying tax? All of
these things need to be
taken into consideration,”
he says.
For Fothergill, the tax
issue raises some more
questions.
“If you are doing the
digital nomad thing and
you don’t necessarily have
a fixed address, the
question is which country
is going to put their hand
out, and which one should
you actually be paying the
tax to?
“For us, our last fixed
address was in Australia,
so that is where we pay
tax. It’s worth doing the
research and letting your
clients or your own
employees know what the
tax implications are,” he
says.
“There is no rule of
thumb that says if you’re
out of the country for
more than a certain
amount of days in a year,
then you’re a non-resident
for tax purposes in
Australia. It’s not that
clear cut. There are a
number of tests and each
of those elements need to
be taken into
consideration.
What about those
contemplating a life on
the road, or the oceans?
“My number one piece
of advice is to seek
professional advice that
pertains directly to your
situation before you go.
Just because a colleague or
a friend has been given
advice that relates to them,
it doesn’t mean that it will
be the same for you.”
intheblack.cpaaustralia.com.au July 2022 51