If you are inheriting money from overseas you need to know how to transfer it to Australia, but also what tax implications there may be. The good news is that, unless otherwise stated, you don't need to pay tax when receiving inheritance money from abroad. So it's more a case of choosing the right method for you in order to keep your transfer costs as low as possible.
Options for transferring an inheritance to Australia
Bank cheques and bank transfers are the most common ways to inherit money from overseas. But there are newer options such as using an international money provider or a foreign currency account which can reduce your money transfer costs.
International money transfer service
One of the easiest ways to transfer money from overseas is using an international money transfer service. These specialist companies often provide a better exchange rate than your local bank and charge lower fees. Specialist providers such as TorFX and OFX have the potential to save you thousands of dollars if you're moving a large amount.
With most, you can set up a free account. Then you will be able to input your transfer details and see what rate and fees you will be charged. As with anything, it is best to compare a few quotes to make sure you are getting the best deal for you.
Foreign currency account
Another option is to open a foreign currency - or borderless account - and transfer the funds there. For example, Wise has a multi currency account that offers competitive exchange rates and low fees. These types of accounts often allow you to transfer money from one currency to another at a click of a button, as well as spend in your local currency with your card and set up direct debits with supported territories to pay bills and subscriptions.
The main downside we found with Wise is they charge a holding fee above a certain limit. For example, if you transfer £50,000, they will charge a 1.6% annual fee on any amount above £13,000. You'll need to move quickly to save on fees.
Bank transfer
Alternatively, you could arrange for the estate executor to deposit your inheritance directly into your Australian bank account. This is a quicker process than waiting for a cheque to clear. But the money transfer will still be subject to the bank's fees and exchange rate which typically cost more than using a specialist international money transfer service.
Bank cheque
Most of the time, when you inherit money from overseas, the estate will give you a bank cheque that you can deposit in your Australian bank account. The cheque should be made out in the foreign currency and will be subject to the exchange rate your bank offers when you deposit the cheque - which is not always the best on the market. It's also worth being aware that a bank cheque will take a long time to clear, so there are faster transfer methods available.
Which international money transfer company should I use?
Our table below lets you compare services you can use to send money abroad. Compare fees, exchange rates and discounts from different money transfer services, and when you have made your choice, click Go to site.
Finder survey: Would Australians be happy to pay a tax on their inheritence?
Response
No
84.86%
Yes
15.14%
Source: Finder survey by Pure Profile of 1004 Australians, December 2023
Is inherited money taxable in Australia?
In Australia, you don't need to pay tax on inheritance. An overseas inheritance is not taxable unless you are advised by the executor that a part of it is. If that is the case, it's advisable to seek professional tax advice.
There are cases where the estate could continue to make an income after the individual's death from the asset sale capital gains or interest accrued on savings accounts. So there may be some capital gains tax liability in these circumstances. Similarly, if you decide to invest your inheritance, you may be required to pay tax on any capital gains under Australia's Capital Gains Tax (CGT) laws.
If you are in any doubt at all, it is best to talk to a professional tax advisor to understand your tax obligations.
Frequently asked questions
There are no inheritance or estate taxes in Australia, so there is no need to declare your inheritance on your tax return. However, if you have inherited assets or are receiving income from the deceased estate, then you will need to include these in your tax return as you may have tax obligations.
Kate Steere is a deputy editor at Finder, specialising in fintech, cryptocurrency and banking. She has previously written for The Motley Fool UK and Fitch Solutions, where she covered a wide range of personal finance topics and kept a close eye on market trends. Kate has a Bachelor of Arts in Modern History from the University of East Anglia. When not working, she can usually be found curled up with a good book or heading out for a run.
What are the best options for sending or receiving a large amount of money overseas? Read this $50,000 case study with exchange rates and fees comparison.
Send an international money transfer to someone without a bank account. Get it there instantly and they can pick it up in person, in cash. Get quotes now.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Important information about this website
finder.com.au is one of Australia's leading comparison websites. We are committed to our readers and stands by our editorial principles
We try to take an open and transparent approach and provide a broad-based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labeling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
We make money by featuring products on our site. Compensation received from the providers featured on our site can influence which products we write about as well as where and how products appear on our page, but the order or placement of these products does not influence our assessment or opinions of them, nor is it an endorsement or recommendation for them.
Products marked as 'Top Pick', 'Promoted' or 'Advertisement' are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment when you click on those buttons or apply for a product. You can learn more about how we make money.
When products are grouped in a table or list, the order in which they are initially sorted may be influenced by a range of factors including price, fees and discounts; commercial partnerships; product features; and brand popularity. We provide tools so you can sort and filter these lists to highlight features that matter to you.
Please read our website terms of use and privacy policy for more information about our services and our approach to privacy.
