1. Is it tax efficient for an individual to buy US shares from Australia?

Making an investment in overseas stock markets, such as the US, can give you access to a wider range of investment options and take advantage of global trends and markets.

Dividends received from US holdings may have some with-holding tax credits that can be used to offset the Australian Tax due on the income. Any capital gain on trading is also eligible for the 50% general discount if the investment is held for more than 12 months.

However, it is important to note that any losses for foreign investments can only be offset against foreign-sourced capital gains.

2. Do you pay inheritance tax in Australia for a property inherited overseas (like your parents’ primary residence)?

There is no inheritance tax in Australia, which is quite unusual when compared to many other countries.

When the property or other assets are passed to beneficiaries via a will, the recipient will receive the assets either:

at same cost base as when they were originally purchased

at the value at the date of death if the assets were purchased pre CGT September 1985.

An exception is made if the deceased’s primary residence is sold within two years from the date of death.

This is the case in Australia but, if the deceased resided overseas, the legislation in that country will apply to their estate. In this circumstance, the inheritance tax may be an issue that requires careful professional consideration.

General Advice Warning: The information in this communication is provided for information purposes and is of a general nature only. It is not intended to be and does not constitute financial advice or any other advice. Further, the information is not based on your personal objectives, financial situation or needs. You are encouraged to consult a financial planner before making any decision as to how appropriate this information is to your objectives, financial situation and needs. Also, before making a decision, you should consider the relevant Product Disclosure Statement available from your financial planner.