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If you need to send money to Australia, all you have to do is follow several simple steps:
Get fast transfers with no fees and a range of foreign currency tools.
A few options include:
Let’s look at these options in more detail.
Most banks will send money to an Australian bank account and exchange your currency into Australian dollars. This method is also known as an international money transfer, a telegraphic transfer (TT), a wire transfer or a SWIFT transfer.
However using a bank will come at a cost. Most banks will charge a flat fee and poor exchange rates, which can have a huge effect on how much the transaction ends up costing you. Additionally your bank and the bank at the other end of the transaction could charge "sending" and "receiving" fees.
Alternatively you can use an online money transfer or foreign exchange company such as OFX, WorldFirst and InstaRem. Simply tell the company you choose how much money you want to send to Australia and they’ll quote an exchange rate, convert the funds, and send them to your nominated bank account.
You can send the funds in a number of different ways including bank transfer, using a debit or credit card, or POLI transfer (real-time online debit payment). You’ll need to set up a separate account with a transfer service, but these services are often much cheaper to use when you are receiving between $1,000 and $1,000,000 and will almost always offer a better exchange rate than the banks.
Money transfer companies such as Western Union, Xpress Money and MoneyGram can send your money abroad using cash or EFTPOS. These companies will have a storefront or a third-party convenience store counter and your recipient will be able to collect the funds from the money transfer office in their country. While this cash transfer option is usually extremely quick, it can be expensive. The fees involved in transferring money overseas can vary depending on a range of factors, including how much money you're sending and from where you're sending it.
Safer than sending a personal cheque overseas, an international money order (IMO) is when you give your money to a bank or post office and get an international guaranteed cheque. Think of it as the international equivalent of a bank cheque. Once you've posted the cheque to the recipient, they can cash it at their local bank and deposit the money into their own account. While this transfer method is secure, posting a cheque will take longer than an electronic transaction and can cost more. You'll have to pay to purchase the IMO and there may be transaction costs when the money is deposited into the overseas account.
Services like Paypal or Western Union (cash pick-up) are considered to be the fastest options as the transfers can be completed in minutes. If you are sending money from one bank account to another bank account it will usually take 1-2 days, depending on the currency you’re converting from. If you’re using an international money transfer company, generally it will take between 1 or 2 business days to send the money to the service, and for the service to convert the money and send the funds to the recipient in Australia.
Banks and Paypal don't have a minimum transfer amount but some online money transfer companies do. If you’re sending less than $500 to Australia via an international money transfer service make sure you check the company’s website for the minimum transfer amount. Banks and online money transfer companies will often have daily and yearly maximum transfer limits, but the amounts vary between providers.
Keep in mind that the Australian Transaction Reports and Analysis Centre (AUSTRAC) requires financial institutions and money transfer services to report any transactions into or out of Australia that are above $10,000. Therefore if you’re sending more than $10,000 to Australia, you may be required to provide some additional information to the money transfer provider before it can complete your transaction.
How much a transfer costs will largely depends on three things — the amount you’re sending, how you pay, and the exchange rate offered on your currency. Here are some fees to consider:
Take note of the following features when comparing online money transfer providers:
Whether or not the money you transfer to Australia from overseas will be subject to Australian taxation will depend on two key factors:
Generally speaking, you can transfer money anywhere in the world as long as you’ve met the relevant taxation laws which apply in the place the money was earned/received. Before you transfer the money make sure that you review the laws which apply in your jurisdiction to ensure that all applicable tax has been paid (eg, income tax, inheritance tax). Once all taxes have been paid in the place you received the money, international treaties will protect you or anyone you’re sending the money to from paying tax on the money twice (double taxation).
Your tax residency status will play a big factor in determining whether your transfer runs the risk of attracting Australian taxation. According to the Australian Taxation Office (ATO), if you are moving to Australia for the first time any savings that you transfer will not subject to Australian taxation. There is no limit on the amount of currency that you can bring with you. However, when you become an Australian resident or citizen, any money that you transfer to Australia from overseas which can be classified as income earned overseas (including income from rental properties) will be subject to taxation and you must to declare it on your Australian tax return.
Alex is an American citizen moving to Australia for work for a period of 12 months. He wants to transfer some of his savings to an Australian bank account to get him started and thinks he will need $5,000 to cover his upfront expenses including the first month’s rent, bond and general needs. He opens a transactions account with one of the Big Four banks and after shopping around for the best deal for his circumstances, decides to use TransferWise to send the funds.
TransferWise charges a combination of a fixed fee and a percentage of the total value of the transfer, varying according to the country where the funds are being sent. From the US, the fixed fee is US$1.25 (0.6% of the amount that's converted) and the percentage fee is US$30 (0.6% of the total amount). Alex is going to use a bank transfer to send the funds so he’s not charged an additional fee. Therefore in fees Alex would be charged a total of US$31.25.
TransferWise uses the mid-market exchange rate when transferring money between countries which as of today (28 February 2018) is 1.28. Therefore after fees and the exchange rate applied, Alex’s Australian bank account will receive AU$6,365.71.
The transaction will take between 1 and 6 days to complete depending on how long it takes Alex’s American bank to send the money to TransferWise. As Alex is sending his savings (money he has already paid tax on) to his Australian bank account, he will not be required to pay tax again in Australia.
