Australia is a country much appreciated by French retirees. Not surprising when we observe its positive points: its favorable climate, its friendly population and its paradisiacal landscapes. Here are the steps and the most useful information if you want to spend your retirement in the land of wallabies.
1.1 million French retirees have chosen to retire abroad. Among them, a few thousand have chosen to come and settle in Oceania and more particularly in Australia.
retirement in australia
The Australian pension system is based, like the French one, on a principle of redistribution.
To access retirement in Australia, there are three requirements:
- Be at least 66 years old (an age that will gradually increase to 67 by 2023)
- Be an Australian resident for at least 10 years and 5 consecutive years.
- Be an Australian resident and live in Australia when applying for a retirement pension (To be considered an Australian resident, you must have a permanent residence visa or have Australian nationality).
The functioning of the health system is based on a principle of contribution. All employers or individuals (in the case of auto-entrepreneurship), have the obligation to contribute to a private retirement fund, called “Superannuation”, for their employees. Thus, your employer is obliged to transfer 9.5% (12% by 2026) of your salary to this private pension fund.
The government also provides a public old-age pension, which is financed by income tax for all its residents. This pension provides a minimum pension for all Australians. The public old-age pension is conditional and may decrease depending on income and assets.
Most Australians also subscribe to a voluntary savings fund to ensure a more comfortable retirement.
How to retire in Australia
The procedures for immigrating to Australia are complex due to the rather restrictive reception procedures.
To retire in Australia, several types of visas can be considered:
The Retirement Visa is valid for 10 years but can take up to 5 years to issue. To obtain it, you must already have obtained an Australian visa such as the Skilled Independent Visa (permanent work visa). It costs $4,350.
The Spouse Visa allows you to live in Australia for life, if you are married to a resident, provided you renew it every 5 years. The Spouse Visa or Partner Visa costs $7850 or €4849.31.
The Family Reunion Visa:
The Family Reunion Visa also allows you to live in Australia. It is issued in several cases, in particular when people wish to come and spend their retirement near their family in Australia. It can cost between $30,000 and $50,000 (i.e. between €18,607 and €31,000) and has no expiry date. Family visas are also issued at lower costs ($6,000) but waiting times often exceed more than 10 years.
The Investor Retirement Visa
The Investor Retirement Visa allows you to come and live in Australia provided you invest in the country with substantial funds. It is necessary to justify a capital (to two or only) exceeding 750.000 $ in Australia at the time of the 1st request and 500.000 $ at the time of the second request. It is valid for 4 years and costs $325 in administrative fees.
Taxes in Australia for a French retiree
Since 2006, there has been an agreement between France and Australia intended to avoid cases of double taxation in terms of income tax. There are two kinds of scale, depending on whether you are an Australian or French tax resident. You must have your main residence or live more than 6 months of the year in Australia to be perceived as an Australian tax resident.
- AU$0 to 18,200: no tax
- AU$18,201 to 37,000: 19 cents per dollar collected
- AU$37,001 to 80,000: AU$3,572 fixed + 32.5 cents per dollar collected from AU$37,001
- AU$80,001 and 180,000: AU$17,547 fixed + 37 cents per dollar received from AU$80,001
- Above AU$180,000: AU$54,547 fixed + 45 cents per dollar received above AU$180,000
If you are a French tax resident, here is the scale that applies to you:
- AU$0 to 80,000 (i.e. €49,620.00): 32.5 cents per dollar received
- AU$80,001 to 180,000 (i.e. €111,645.00): AU$26,000 fixed + 37 cents per dollar received from AU$80,001
- above AU$180,000: AU$63,000 fixed + 45 cents per dollar received from AU$180,000
In Australia, there is no wealth tax or inheritance tax. However, there is a tax on capital gains (Capital Gain Tax)
What is the average monthly budget for retirement living in Australia?
The cost of living in Australia is slightly higher than in France. A cinema ticket can easily cost more than $17 (€11), a pack of cigarettes €14.3 and shopping costs on average 40% more expensive than in France.
The Australian State recommends planning a budget of around $4000 (2481.00) per month in the regions and $5000 (ie €3101.25) per month in a state capital.
For an apartment in the heart of Sydney, you will have to pay at least $2,000 (or €1,240.50) per month. If you plan to buy a property, the average price per m2 in Australia is $2,483 (or €1,540.08) but can rise exponentially in the country’s largest cities (€13,000 per m2 in Sydney).
Being a French retiree in Australia
Retiring in Australia can be fraught with inconvenience, due to the high cost of living and its costly healthcare system for foreigners. However, the beauty of the country, as well as its favorable climate all year round, make it a very pleasant destination to spend your retirement.
Where to live in Australia for retirement?
Several regions are a delight for retirees in Australia, they are generally quite far from major cities. Some will prefer to be close to the sea and will settle in Gippsland in Victoria, in the Huon Valley in Tasmania or even in the Sunshine Coast in Queensland. Others will feel more comfortable in wine regions like the Hunter Valley in New South Wales, the Adelaide Hills in South Australia or the Margareth River in Western Australia.
Sunshine Coast in Queensland:
The Sunshine Coast stretches from the town of Caloundra, near Brisbane, to the Great Sandy National Park further north. It is the ideal destination for beach and sun-hungry retirees, since this region is home to sumptuous beaches and an equally magnificent rural hinterland.
Gippsland in Victoria:
Further south, east of Melbourne, lies the territory of Gippsland. It extends from the island of Philip Island to Gipsy Point. Between its luxuriant forests, its waterfalls, its lakes and its ecological reserves, this large corner of paradise is the perfect place for nature lovers.
Hunter valley in New South Wales:
The Hunter Valley is one of Australia’s finest wine regions. To reach it, you will have to drive 2 hours north of Sydney. Retirees will find in the Hunter Valley, the joys and charms of rural Australia with sublime hilly landscapes.
Margareth River in Western Australia:
On the other side of the country, south of Perth, is a great wine region coupled with a superb coastline bordered by bush. The area is renowned for its world-class wine estates including Vasse Felix and Leeuwin.
The motorhome retreat in Australia
In Australia, there are also many retirees who have decided to become nomads. They are called the Gray Nomads, and they live and travel in motorhomes, caravans or even buses to leisurely tour the country and enjoy the best weather in the country at any time of the year.
Are there residences or retirement homes in Australia for the French?
There are, as in France, many retirement homes in Australia. However, they are very expensive, since it will cost an average of $8,800 (or €5,458.20) per month for a single room and $7,750 (or €4,806.94) for a shared room.
Since 2018, there has been a retirement home for Francophones in Sydney. It is called the Summit Car, and is located in Baulkham Hills.
Insurance, mutuals, doctors, How to take care of your health in Australia?
First, it is advisable to join the Caisse des Français de l’étranger (CFE), since you do not have access to Medicare, Australian social security (which is reserved for permanent residents and Australian citizens).
Even if you are eligible for Medicare, not all treatment is covered, such as dental treatment, which encourages many Australians to take out supplementary health insurance. It is therefore strongly recommended to take out additional health insurance, as a simple ambulance trip can cost €2,000.