Australia’s tax year runs from 1 July to 30 June, which already puts Indian-origin residents on a different clock than the one they grew up with. Add in the fact that Australian tax residents are assessed on worldwide income, and Indian bank interest, dividends, and capital gains all need to show up on the Australian return too.
The Australian Taxation Office treats foreign income the way most developed-country tax authorities do: it wants it declared in Australian dollars, converted using an appropriate exchange rate, for the relevant Australian income year. NRE and NRO fixed deposit interest, mutual fund distributions, and gains from selling Indian property or shares all fall under this. The India-Australia Double Taxation Avoidance Agreement generally allows a credit for tax already paid in India, but claiming it correctly requires matching Indian TDS certificates and capital gains computations to the Australian financial year, which rarely lines up neatly with India’s April-to-March year.
Capital gains on Indian property deserve particular attention. India applies its own capital gains tax and TDS rules on property sales by non-residents, and Australia will separately want the gain reported and taxed at Australian rates, with foreign tax credit relief for what was already paid in India. Getting the cost base, holding period, and currency conversion right on both sides takes some care, and errors tend to surface only when the ATO cross-checks foreign income data years later.
The organisational work is mostly about timing and documentation: Indian tax certificates, Form 26AS, capital gains statements, and TDS proofs need to be readily available, and ideally translated into a format an Australian accountant can actually use.
Ashutosh Financial Services works with NRI families across Australia who find that reconciling two financial years and two currencies is the hardest part of this exercise, not the tax rates themselves. Ashutosh Financial Services continues to hold educational sessions on Indian-Australian cross-border tax matters for NRIs looking to stay compliant on both sides.
