All Australian residents for tax purposes must declare all income they earn on their Australian Income Tax Return, whether the income is earned in Australia or overseas.

Under the Common Reporting Standard for the automatic exchange of financial account information, banks and other financial institutions will collect and report to the ATO financial account information on Australian residents from other countries’ tax authorities.

As the CRS provides the ATO with a powerful data matching tool, Australian resident taxpayers should ensure that details provided to any foreign financial institutions are correct and kept up-to-date. All foreign income should be declared in income tax returns to avoid penalties and interest.

Note Foreign income to be declared can include interest, dividends, rental income, capital gains and also business income.