Sunday, 1 September 2013

Migrating your money to Australia

Hi everyone!

A has shared with us how much it cost us to migrate to Oz. Now it's time for us to begin transferring our money to Australia, given the decent exchange rates... While our PR is still pending thanks to my medical, we have assessed that it is worthwhile to transfer at least some of our money over for now.

This post is not just for those who are migrating to Oz, but anyone who may want to transfer money to an overseas bank account. Of course, I will be covering additional information specific to those making a long-term move to Australia, so bear with me.

Do note that I am by no means an expert or even experienced when it comes to such matters. I am merely sharing what I went through. So if you have alternative or better ways to do it, please share in the comments section below. What works for A and I, may not work best for others, so I am sure some of you readers can enlighten us too!

Setting up your Australian bank account

Obviously for prospective migrants, you'd have to set up your bank account down under first. A bank account demonstrates a certain level of financial status to your prospective landlords as well as providing a means for employers to pay you. Setting it up from abroad allows much more lead time and allows you to transfer your funds in your own time, perhaps at a competitive exchange rate. Which bank you'd choose would boil down to individual preference, or pure randomness if like us, you can't make sense of the deluge of information from the internet or helpful friends and relatives.

For starters, I set up a Commonwealth Bank account for A, and National Australia Bank account for myself. Both these banks (and I presume the other Australian or even international banks) allow for applications from overseas, but the money transfer is a ONE-WAY STREET until you have personally activated the account. That means you can only access and transfer the money out of your CB/NAB accounts after you have presented yourself at the bank in Australia, and activated the account with the relevant identification documents.

Why different banks? I didn't know better so I decided to anyhow whack. I usually learn best from personal experience. Turns out that NAB has zero account fees and much more responsive customer service. I can't promise that you will have the same experience with regard to customer service, and A's NAB account did take a few days longer to set up than mine. However, her Commonwealth Bank application process has stalled and we have been subsequently been unable to contact the person - or cyborg - who first made contact with us. I just hope that we won't find her saddled with charges for the apparently-orphaned account that we are just going to abandon. Yes, CB charges monthly fees of between $4-6.

My approximate expression when faced with all the options. Though I am far less handsome...

I guess it only makes good business sense to move fast and furnish your potential customers with all the information needed to transfer funds. In this aspect, NAB hasn't disappointed. Which is why I have been able to make three transfers thus far (trying to catch decent exchange rates) and verified through NAB internet banking that the money has reached my account, though it's stagnant until we show up there. Not that I'd mind, with 4% p.a. interest for the first four months in NAB iSaver thanks to their promotion. The usual rate of 2.5% p.a. applies after that.

Best Bank in Singapore to transfer from?

Having evaluated Standard Chartered, UOB and DBS personally, DBS comes out tops in my book. Best foreign exchange rates every time I've checked, with the lowest fees. Our friend working in Oz told me that Citibank offers comparable charges to DBS (before the special offer mentioned below), however, their exchange rates are inferior in the few instances I have compared.

If you are transferring a small sum of money, whatever bank you are using should be fine. But if you are transferring a larger sum of money, say above $10k, you might want to consider moving your money to DBS first.

Existing DBS customers should note that there is currently a special offer for Internet Banking transfers. Zero charges from the Singapore side! But A$5 per incoming transaction from NAB.

For me, DBS iBanking works just fine. I find that it is effectively as secure as going to the bank to do it, because any theoretical increase in risk of doing the online transfer is mitigated by my ability to check and doublecheck my recipient's details at my own time, from the comfort of home.

So, how does one transfer the money?

This is where I have to say that, "If you have to ask..."

I really won't know how to help you. But do leave a comment if this makes you feel very outraged or cheated. :p

I've found all the internet banking services (from DBS, Citibank, UOB, Stanchart, NAB) to be quite user-friendly. So it's just a matter of getting Internet Banking services set up via your bank's website, then following the instructions. In fact I think DBS's ibanking is the least user-friendly of all those I've tried, due to the ever-changing, and very abundant functions. But given the competitive rates, I have no complaints. "Least" is relative, it just feels less intuitive, but hasn't given me any problems I couldn't overcome thus far

Good for visiting friends

If you have friends you trust in the country you are visiting, and you are changing more than a few hundred bucks, it may make sense to change just a bit of foreign currency and transfer the rest of your budget to them via internet banking. The rates DBS offers are about 1c off the Internet exchange rates, better than any local money changer I have seen, at least for the Australian dollar.

So if you are coming to visit us in future and don't want to carry so much cash, you know what to do! Don't be shy ;).

- S


  1. Hi,

    Not sure if you are aware, transfers betw Citibank accounts dont incur any overseas funds transfer charges. I didnt do my HW abt exchange rates offered by local banks but I guess some savings from the overseas funds transfer charges offset any poor exchange rate differences. Plus if you have intentions of channeling funds from Spore to Aust on a regular basis, it'll b gd to consider this. This means you have to open a Citibank account here and one in Australia.

    My relative has been transferring funds from his Citibank account in Perth to his mother who opened a Citibank account for this purpose.

    1. Did some homework. Now I don't know how my friend's fee came up to $25.

      " - Transfer funds between your Citibank Singapore account and other bank account(s) in Singapore for free
      - Transfer up to S$50,000 instantly and cost effectively between Citibank accounts globally with Citibank Global Transfer (CGT)"

      Then, when I check out CGT, it's either $10 per transfer, or "free for Citigold and Citigold Private Clients."

      In the end, it will boil down to the bank's rates, unless one is talking about frequent small sums.

  2. Hi KT, thanks for your comment :)

    Your relative's experience seems to differ from my friend's. He said that it's $25 per transfer from SG to Oz, but free for the other way around. He did a transfer within the past few months. But perhaps it's possible there are different account types, or something

    At 1c per dollar poorer rate than DBS, let's just say that even if it were completely FOC for Citibank, I still lose out at the amount that I transfer, even assuming DBS's usual fees (S$30 from DBS, and of course the A$5 from NAB).

    However, it's effectively just A$5 per transaction now with the promotion. The Citibank rate will essentially have to match DBS's in order for it to make sense.

    We will not be doing regular transactions of SGD to Oz. I only did a few 'feeler' transactions to try to average out the exchange rate as well as to test my NAB account to see if it would actually receive the money!

    I wouldn't say that Citibank is a bad deal per se. I also use Stanchart and found their overseas transfer fees downright appalling. But I use them for the BonusSaver account so I'm not complaining. Using the right bank for the right purpose. Not much $ so must stretch every cent :p.

    Irony is that I closed my Citibank Step-up account when SCB announced the BonusSaver. Back then I really hadn't looked that far ahead. I guess *could* open a Citibank account if it was a compelling enough case, but it doesn't quite seem that way for now

    - S

  3. Hi! just want to say i really enjoy reading your very informative blog! Please keep writing and posting. When do you plan to go down-under? I was granted my visa last year, planning to move over maybe mid-2014.


    1. End of this year, hopefully :)

      I assume you have made your first trip there to validate your PR visa?


  4. Hi! I have been following your blog - wealth of informations on the migration process to Oz! Great job! I have a question, if you have any thoughts on this, do let me know....

    if I move some savings via bank transfer say AUD$ 20,000, would this be considered taxable income? Since I’ll be considered a resident when i migrate, as my category might be a Australian Tax resident by then

  5. Hi Anon,

    Thanks for your question. In general, bank transfers are fine. But you are supposed to declare all your assets at the start so...

    Hypothetical scenario with exaggerated numbers coming up:

    Say you move to Australia, but you have S$100k in your SG accounts. You keep it here. Exchange rate is 1SGD:1AUD.

    6 months later you transfer 20k, exchange rate no change. No issue here whatsoever.

    However, let's say that instead of same exchange rate, the SGD got stronger, now 2 AUD to 1 SGD.

    Your AUD 20k now realised a profit of AUD10k. That will factor into your annual tax assessment.

    As an Oz resident (or is it tax resident? or both? I'm still trying to read more on this), you will be taxed on your international earnings, as well as any realised forex gains as seen in my simple example above. But for relatively small amounts like 20k, I'm not sure how ngeow they are. Sounds like they don't keep such close track on such amounts.

    Try 200k and you will likely hear from ATO about this. It's lagi worse if they find you later, because there's a fine for every year one otangs them in taxes.

    If you transfer all your assets over before you first reach Australia, your life will be a lot simpler. That's the route we will try to take, of course leaving some petty cash in SG to pay the insurance bills for some time.

    I will try to do a complete and more detailed post on this once I get my head really screwed on regarding this issue. Stay tuned!


  6. Hi S,
    Will you sell your property before leaving for Melbourne or leave it here to generate rental income?

    1. We found a buyer already. Now just waiting to finalise the sale.

      The market was starting to smell a bit, so we assessed it would be a good time to bail. It was between a lump sum and a modest stream of income which wouldn't have made much impact.

      Not to mention the additional hassle of dealing with a tenant, plus rental income in SG is taxable by Australia (we didn't know it then, but that's something for wannabe migrants to consider).

      Also, there's no turning back. We've even emptied our OA into SA to generate interest. Hopefully one day we can take it out (yes, Oz will tax on the interest earned from the time we reach there, till we withdraw).


  7. Congrats again. Looks like you are all set to leave Spore for good. I'll continue reading your blog on your updates. All the best!

  8. Have you tried using Ozforex to transfer your money? It seems to offer the most competitive rates with no fees if you transfer a certain amount. If you find it less worthwhile do let me know then its time for me to switch.

    1. Hi Anon, will check it out. Thanks for the headsup. :)

      I think you would have a better picture than me actually. I have painted the DBS deal quite clearly. If Ozforex is even better than that than it should be ok.

      I'm guessing DBS has the slight edge in sheer convenience. Ozforex is an additional middleman. The certain amount is 10k and I would not be worrying about the fees.. :x Haha...

      If you are doing small amounts from DBS to NAB, then DBS may be overall cheaper.

      I am convinced enough to sign up for an Ozforex account and see the process and exact rates/fees.

      Unfortunately I may not be able to get back to you quickly on this, as we will be traveling overseas to start our divemaster internship shortly. I do ask for your patience.

      - S

    2. Ozforex may lose out to DBS. I found that out only after spending (time not exactly wasted if I can share my experience with others) maybe an hour of my life and five minutes of overseas call to Oz.

      The rate is inferior at least right now. Before I signed up, I checked the spot deal, the rate was very similar to online rate and about 1c better than DBS.

      After I managed to activate my account (which involved calling Oz for a good 5 min, waiting a few days for a snail mail with address activation), I found the spot rate slightly inferior to DBS's

      And yes the DBS rate is updated.

      Will monitor next week but it's a bummer as we'll be there by then. Or I may just do another transfer right now via DBS.

      - S

  9. Just to share with those doing forex to AUD, ozforex does seem to give slightly better rates than DBS online rates, especially for larger amounts (saves you a few dollars if you are penny pinching) and provided you have already opened an onshore australian bank account. Interestingly, ozforex uses a dbs account to receive monies from Singapore consumers.

    The ozforex account opening is a bit of hassle but they have helpful staff to respond to email enquiries. Once the account is opened, I find it a useful alternative channel for finding better spot rate deals.

    1. Yeah I reckon our amounts weren't quite large enough, or the better rates were only available if I rang in. All done by now, and I might actually end up having to transfer small amounts over there in future as and when required. Oh well...

      But I do hope fellow readers take note and that they find your advice useful as well!


  10. Ozforex users:

    Couldn't register country of birth as "Singapore" and the agent replied, confirming that they aren't allowed to operate in SG. How did you manage to register an account?

    Thanks in advance :)

  11. I use POEMs. It is easy. And if not mistaken, the best exchange rate I can find in Singapore while able to TT direct to the Aus a/c.

  12. Hi, I have a question, Say
    a. If you have some investment in Singapore, which is going to complete in next 5 years. At that moment you need to transfer that amount to AU. Will you have to pay taxes on this amount.
    b. If you have some shares, given to you by your company as performance bonus. You have already paid taxes on the relevant amount. But since you haven't sold them, you don't have money instantly. In future if you sell these shares and transfer money to AU, do you have to pay taxes again.

    Thanks for your response.