While your local bank branch may be the most obvious way to send money overseas, a secure money transfer company will offer a much better exchange rate. Make sure you don't pay more than you need to by learning about the choices available and the potential fees involved in transferring big sums internationally.
Send money overseas with TorFX
TorFX guarantees to match any competitor's exchange rate. Conditions apply.
Send money overseas in 30+ currencies with competitive rates for transfer amounts over $2,000.
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Tips for large transfers
Before sending a large transfer overseas:
- Check transfer limits. Some service providers will limit how much you can send daily or monthly, so choose a provider with a high limit or no limit when sending $1 million overseas.
- Negotiate. Many of the rates quoted by providers may be affected by the amount you're sending and could be negotiable, especially with larger sums.
- Research tax laws. Each country has their own set of tax laws, and you or your recipient may need to file taxes.
- Research sanctions. If you're sending money to a country with sanctions imposed by the Australian government, contact a professional to help you navigate the rules.
- Understand the risks. Digital money transfer specialists often send billions of dollars a year and are almost always regulated by federal agencies in a variety of countries.
Compare high limit transfer services
Use our table by entering the amount you want to send and where you want to send it. Click Calculate to see live exchange rates based on the amount you entered.
Disclaimer: Exchange rates change often. Confirm the total cost with the provider before transferring money.
Using a money transfer service
Specialised money transfer companies are typically the cheapest and fastest option for secure overseas transfers. You can also track your money along each step of the transfer, with online and phone support available if you have any questions.
Let's crunch the numbers: Sending $1,000,000 to Japan
Let's say you need to send $1,000,000 AUD to JPY to family in Japan. Here's what you might face as far as fees as of 9 November 2020 with a mid-market rate of 1 AUD = 75.45 JPY.
|Fee||$0||~$34 including correspondent bank fees|
|Exchange rate||1 AUD = 75.131 JPY||1 AUD = 72.22 JPY|
|Transfer speed||1-2 day||1-2 days|
|Amount received||JPY ¥75,130,877||JPY ¥72,867,500.00|
Using a money transfer service dedicated to large transfers will send almost 2.5 million more JPY to your recipient than the bank. When comparing the money transfer service to the best possible transfer, a mid-market rate exchange, the rates offered are within 0.5% of one another.
Should I use my local bank?
You can, but it might be pricey. On top of weaker exchange rates and higher fees, you'll find it typically takes longer for your bank to transfer money internationally. This could be a problem if your money needs to get to its destination by a certain time. Also, your bank may not be able to transfer money to every country.
How important is the exchange rate?
Given the amount of money you're looking to send, a solid exchange rate is critical. Even minor variances in exchange rates can save — or cost — you thousands of dollars.
For example, if Company A quotes you an exchange rate of 1 AUD = 0.880 EUR and Company B quotes you a rate of 1 AUD = 0.885 EUR, that half a cent difference adds up to $5,000 on a $1 million transfer.
If you have time on your side, you may want to use a limit order. A limit order allows you to set a target exchange rate with a service or broker, which monitors the rates 24/7 to make sure you don't miss it. Once exchange rates meet your target, the service or broker will contact you to complete the transfer.
Money transfer fees
Money transfer providers charge fees to increase profits and make up for the time they spend filling out reports for international transfers, such as currency transaction and Know Your Customer reports.
Some fee-free transfer providers make up that money with less favourable exchange rates, which can cost you more when you're sending a large transfer.
When choosing a transfer provider, factor in both the exchange rate and any fees to get the best deal.
What are the tax rules for large money transfers?
If you're sending a large sum of money to someone overseas, you usually don't need to worry about any tax implications for yourself. However, the receiver will often have to consider tax issues. For example, in the US, the recipient needs to fill out Form 3520 on their taxes if they receive above US$100,000 from an individual or US$15,601 from a foreign corporation. Similarly, in India, money transfer recipients must report any transfers above INR50,000 on their taxes.
If you're transferring the money to your own account overseas, you'll also need to declare this on your taxes. The Australian Taxation Office (ATO) taxes you on your worldwide income if you're an Australian resident. Potential income sources include the following:
- Rental income from an overseas property
- Capital gains made on an overseas asset, like a property
- Offshore bank accounts
- Interest received on a foreign account or investment
Keep in mind that if you've already paid foreign tax on any of these sources, you may be able to get a tax offset, which means you won't have to pay double tax.
Business or personal? This will change the tax you pay
If you’re investing in a business, you may be required to own property in the country where you have your offshore account or holding company. That can mean significant additional costs – not just for the purchase of a residence, but also for the legal or account registration fees that may be required for setting up the holding company.
Offshore trusts, foundations or businesses can provide a way to restructure ownership of assets in the case of lawsuits or debt issues at home, making them an attractive option to protect individual assets from seizure. However, there are still tax implications for whoever holds the assets offshore.
When sending money to children studying or working abroad or to family overseas for other reasons, you may need to consider if that country has a gift tax. In Australia, a one-time gift generally isn't taxed as long as it doesn't relate to any business-like activity.
Laws and legal documents you need when transferring large sums of money
Compare money transfer services now
If you're sending $1 million or more overseas, even a small difference in the exchange rate can add up to thousands of dollars. Compare international money transfer providers to make sure you're getting the best deal.
What else do you need to know?
In cases where Australia has imposed sanctions on a country, sending money can be far more complicated, though not impossible. Finding someone who can help you navigate the rules and understand the options makes a big difference.
Countries with sanctions include the following:
Service providers will also limit how much you can send daily or monthly, so you'll want to factor this into your decision. Also, the amount you're sending may affect the rates that providers quote, so you may be able to negotiate a better rate, especially with larger sums. You may even be able to negotiate sending limits, although this may require additional evidence and reporting.
Whenever the opportunity to send a large amount overseas arises, compare your options, ask questions and consider the exchange rates and fees, so you can hang onto as much of your money as possible.
Frequently asked questions