Expat's Guide to US Expat Taxes for Australia Residents

Whether you're working in Sydney, Melbourne, or another Australian city, you need to file Australian and US tax returns and find your way around complicated forms like Form 8938 and FBAR disclosures. Expatfile can help you understand US expat taxes in Australia. Our software can help you:

• Report worldwide income to both the IRS and the Australian Taxation Office (ATO)​
• File a FBAR if foreign accounts exceed $10,000 at any time during the year​
• Claim Foreign Tax Credit or Foreign Earned Income Exclusion to avoid double taxation​
• Disclose Australian superannuation on Form 8938 when asset thresholds are met​
• Navigate different tax years for Australia (July-June) and the US (Jan-Dec)​

[Try Expatfile Free Today]

Welcome to Australia! Australia is a well-known destination for many Americans abroad. With its high life satisfaction rankings, serene weather, and stunning multi-cultural diversity, it's undeniable that moving Down Under is a popular choice!

While you are moving Down Under, do not forget that you still need to file your taxes in the United States, and you should keep the June 15 deadline in mind. To make things even more difficult, you'll also need to file an Australian tax return if you live and work in Australia. Expatfile can help you file your US tax return while living in Australia.

Ready to file your US expat tax return in less than 15 minutes? Make it easy with Expatfile's DIY tax software designed specifically for Americans living and working abroad. The fastest way to get your US taxes done from Australia!

Do I need to file 2 income tax returns - both US and Australia?

US expats must always file their tax returns in the United States, regardless of where they live and work. The reason for this is that the US collects taxes based on citizenship, not residency like most countries. If you are an American (or a green card holder), you must file a US federal tax return in Australia.

Since Australia levies income taxes based on residency, you will also need to file a tax return in Australia if you are an expat.

You can be considered a resident taxpayer if your domicile (the place where you permanently reside) is in Australia. A domicile is a place that is considered your permanent home by law.

Generally, Americans who live and work abroad are required to file tax returns in both the U.S. and Australia. This does not automatically mean that you will be taxed twice on the same income. We will explain this in more detail below.

How do US expat taxes work while you live and work in Australia?

If you work in Australia, you must report that income on your US expatriate tax return.

So, if you are employed by an Australian company and receive wages, you must report that income on your US tax return as an American living and working abroad. You must also report the same income on your Australian income tax return.

To avoid double taxation of your income, the US has introduced several tax breaks for expats, which are explained below.

Most important expat tax breaks:

If these tax breaks are not enough to mitigate your double taxation, the tax treaty between the United States and Australia may also help to fully resolve your double taxation.

In addition, you may be required to file an FBAR if your Australian bank or financial accounts total more than $10,000 in a tax year, or you may even be subject to FATCA reporting requirements (Form 8938) if your foreign financial assets exceed $200,000 ($400,000 for married couples).

What is the income tax rate in Australia compared to the US?

As an American abroad you need to be aware of the below tax rates for resident taxpayers in Australia. To illustrate the difference with the United States, we have compared both income tax rates.

When is my Australian income tax return due?

Personal income tax returns in Australia need to be filed by October 31. Be noted that their book year runs from July 1 to June 30.

Should I take the FTC over the FEIE if I live and work in Australia?

Since the Australian tax rates are higher than in the United States, it is most of the time more beneficial to claim the Foreign Tax Credit over the Foreign Earned Income Exclusion. Let us illustrate with an example:

• Mike lives and works in Australia and is employed for an Australian employer and receives an AUS equivalent of $140,000.
• The US would levy $25,000 US income tax on this income.
• Australia would levy $30,000 Australian income tax on this income.
• By claiming the Foreign Tax Credit Mike can totally offset his US tax bill with the Australian taxes paid ($25,000 US tax -/- $25,000 Australian tax = $0 US tax).
• Mike even has $5,000 Australian taxes which can be carried forwards as foreign tax credit in future years.

If Mike would take the Foreign Earned Income Exclusion, he would still have a taxable income of $31,300 (if you would not have any other deductions to reduce his taxable income to nil).

In summary, the Foreign Tax Credit is more beneficial than the Foreign Earned Income Exclusion since there is no limit to credit your Australian taxes against US taxes with the Foreign Tax Credit. If your Australian taxes are higher than your US taxes would be, you would not owe any US tax while living in Australia. However, our DIY tax software can determine what is best for your expat situation.

This does not mean that you don't need to file a return. You need to prove that you don't owe by filing a return!

How to deal with the different tax year in Australia in your US taxes?

Australia keeps a different book year than the United States. The tax year in Australia starts on July 1 and ends the next year on June 30. This affects how you report your income for the calendar year required for your tax return as a US expat.

To meet the calendar year requirements, you will need to recalculate your Australian annual returns to reflect a full US tax year.

You could also opt for a pragmatic solution. You consistently report your Australian tax year as a US tax calendar year. As long as you stay consistent each year and do not under report any income, there should not be any issues. Most expats do not owe tax anyway and it's just a timing difference.

How to treat Australian superannuation contributions for your expat tax return?

In Australia there are what are called superannuation contributions. Although these are considered deductible for your Australian taxes, they cannot be considered deductible. In other words, your superannuation contribution cannot be considered tax-free in the United States. Any income generatedin the funds are considered taxable, even if not distributed to you.Note that if you have privately held superannuation fund, it may trigger additional reporting obligations in the U.S. as well.

Do I need to pay social security in Australia?

Generally, if you work in Australia, you will have to pay social security contributions. Social security is collected by the Australian government to fund health insurance, unemployment insurance and pension plans.

Good news for self-employed expats. Australia has a totalization agreement with the US, so you do not have to pay social security twice, in Australia and in the US. If you are a self-employed expat in Australia and can provide a certificate of coverage as proof, you should be exempt from self-employment tax (list SE).

Read more on how self-employed expats and digital nomads are taxed in the US.

How can I file a US tax return from Australia?

Filing your US taxes doesn't need to be intimidating or considered as difficult as we made is super simple with our DIY tax software specifically built with expats in mind. Here at Expatfile, we make preparing your own US expat taxes simple, safe and as quick as in 10 minutes!

Ready to file your US expat return and be done for the year? Pleas follow the below steps and finish your expat taxes:

1. Log into our DIY tax software for expats and start your return.
2. Finish our easy-to-understand questionnaire and see what you owe or receive as a refund. No tax expertise needed!
3. Review your return directly.
4. E-file your expat return yourself with our built-in connection with the IRS.
5. Get an instant receipt acknowledgement from the IRS (through our software).

Give Expatfile a try and start for free today. You pay at the end and only when satisfied! Have any further questions, do not hesitate to reach out to our customer support team.

Do I Need to Report My Australian Superannuation on My US Tax Return?

You typically have to report your superannuation balance on Form 8938 in Australia if your total foreign assets are over the threshold - $200,000 for single filers or $400,000 for married filers. In addition, if your foreign accounts hold more than $10,000 at any time throughout the tax year, you must file an FBAR (FinCEN Form 114) separately from youryour tax return.

Tax professionals tend to consider privately held Australian superannuation a foreign grantor trust, which can involve extra forms and lead to instant US taxation of fund earnings.

What US Expat Tax Deductions for Australia Are Available to Minimize My Tax Burden?

American expat tax filing in Australia provides several deductions and credits to help you avoid double taxation on your global income. Foreign Earned Income Exclusion (FEIE) allows you to exclude as much as $130,000 of foreign earned income in tax year 2025, so long as you meet either the Physical Presence Test or Bona Fide Residence Test. Along with the FEIE, you might also be able to claim the Foreign Housing Exclusion or Deduction, which, for Sydney, was a $62,300 per year limit in 2025.

If you are a self-employed expat, you may be able to deduct qualified housing expenses from your gross income, such as rent, utilities, and insurance. Or you might be eligible to claim the Foreign Tax Credit (FTC) for taxes paid to the Australian Taxation Office.

Most expats also meet the general deduction ($15,750 for single filers in 2025) or itemize deductions. Contributions to US-based IRAs remain deductible if you have sufficient earned income, and you could be eligible to claim the Child Tax Credit if you have qualifying dependents.

How Does the US-Australia Tax Treaty Avoid Double Taxation?

The US-Australia Tax Treaty provides considerable relief against double taxation under Article 22, under which US expatriates can claim Foreign Tax Credits for Australian taxes paid. This bilateral agreement establishes which country has major taxing powers over different kinds of income, including employment income, investment income, and pension payments.

The treaty does not eliminate your US filing requirement. Most US citizens and green card holders must file annual US expat tax returns regardless of where they reside. The treaty has a "saving clause" by which the US can still tax its citizens unless an exception under a treaty applies for specific incomes.

For specific treaty-based claims, you will need to file Form 8833 with your return to report your position. While the US-Australia Tax Treaty avoids double taxation on most types of income, it is lacking in Australian superannuation, a complex area for expat tax filing compliance.

Filing US Expat Taxes in Australia Doesn't Have to Be a Nightmare

Australian expat tax filing needn't be a nightmare with the right tools and support. Expatfile simplifies American expat tax filing in Australia with easy-to-use software designed specifically to help expats maximize deductions while staying within IRS and ATO guidelines.

Start your free trial today to experience the Expatfile difference! Try Our Free Trial.

This article was reviewed by Teby, IRS Enrolled Agent

Last updated: January 13, 2026