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Can Australian Expats receive US Social Security Benefits while living in Australia

  • Writer: Mitchell Kelsey
    Mitchell Kelsey
  • Jul 1
  • 4 min read

Updated: Jul 3


US Social Security Benefits while living in Australia

If you're an Australian who spent part of your career working in the United States (US), you may be wondering if you can still receive US Social Security benefits while living in Australia.


This is a common question we hear from returning expats who want to ensure a smooth and tax-efficient transition into retirement. The answer is yes. In many cases, Australians who have lived and worked in the US can access Social Security entitlements after returning home. However, there are key rules and planning considerations to be aware of.


In this article, we’ll look at what you need to know about accessing US Social Security benefits while living in Australia, and how an Expat Financial Adviser can help manage this part of your retirement income strategy.


Who Qualifies for US Social Security?

To be eligible for US Social Security retirement benefits, most individuals must have worked in the US for at least 10 years (40 quarters) and paid Social Security taxes during that time.


If you’re an Australian expat who worked in the US, you likely paid into the system and may be eligible to claim benefits once you reach retirement age in the US. Full retirement age in the US is age 66, however, you can access social security early at age 62 at a reduced benefit amount.


If you didn’t meet the required 40 quarters while working in the US, you may still be entitled to US Social Security Benefits under the US-Australia Totalization Agreement (see below).


The US-Australia Totalization Agreement

Australia and the United States have a Totalization Agreement designed to help people who have split their careers between both countries. This agreement allows your Australian work history to be combined with your US work credits to help meet the minimum eligibility requirements for benefits.


For example, if you worked in the US for only 6 years and the rest of your career in Australia, the agreement may allow you to qualify for partial US Social Security benefits. This can be a valuable supplement to your Australian retirement income.


Can I receive US Social Security Benefits while living in Australia?

Yes, the US Social Security Administration (SSA) allows benefits to be paid to eligible individuals residing in Australia, one of the many countries where payments are permitted. There is also no requirement to be a US citizen or visa holder at the time of applying to be eligible for US Social Security Benefits either. You can:


  • Receive monthly benefits directly into an Australian bank account. Payments are made in US dollars and converted to Australian dollars by your bank; or

  • Maintain a US bank account for deposits.


This makes it entirely possible to continue receiving monthly US Social Security benefits as part of your retirement plan, even after you’ve permanently resettled in Australia. You must keep your information up to date with the SSA, including your address and banking details.


Are US Social Security Benefits Taxable in Australia?

US Social Security benefits are not taxable in Australia. This is due to the Australia-US Tax Treaty, specifically Article 18(2) of the treaty, which states that Social Security payments made by the United States to a resident of Australia shall be taxable only in the United States. This means you do not include US Social Security payments in your Australian tax return.


It’s worth noting that this exemption only applies to US Social Security benefits. Other types of US pensions (e.g., private pensions, 401(k), IRA distributions) can still be taxable in Australia. Learn about moving US retirement accounts to Australia.


Are US Social Security Benefits Taxable in the US?

Even though Social Security benefits are exempt from tax in Australia, they are still taxable in the US, even if you're living in Australia. However, you can opt to have US federal income tax withheld from your Social Security benefits. This is called Voluntary Tax Withholding (VTW), and it's a convenient way to avoid a large tax bill at the end of the year and often removes the need to file a tax return in the US.


Key Planning Considerations for Returning Australian Expats

Here are a few things Australian expats should keep in mind when planning to claim US Social Security benefits:


  • Eligibility check: Confirm whether your work history qualifies you for full or partial benefits.

  • Timing: Benefits can be claimed from age 62, but delaying may increase your monthly payment.

  • Currency risk: Fluctuations in exchange rates can impact the value of your benefits in AUD.

  • Tax efficiency: Coordinating your US Social Security with Australian superannuation and other income sources is vital for a tax-effective retirement strategy.


Conclusion

If you’re an Australian expat returning home to retire, you don’t have to forfeit the US Social Security benefits you’ve earned. In most cases, Australian expats who have since returned home can still receive US Social Security benefits while residing in Australia. Thanks to the tax treaty, the benefits are not assessable in Australia.


To make the most of your US Social Security benefits while living in Australia, you may want to consider working with an experienced Expat Financial Adviser, who can help you to integrate them into your broader retirement income strategy.


Runway Wealth Management is the trusted Financial Adviser to the Australian Expat community. Our tailored advice is backed by expertise, education and experience, which allows us to be at the forefront of Australian Expat Financial Planning.


If you would like to speak to one of our Expat Financial Advisers about this blog or if you have other queries, we would be more than happy to speak with you. Feel free to send us an enquiry through the ‘Contact Us’ tab provided in the below link:



General Advice Disclaimer: The information contained herein is of a general nature only and does not constitute personal advice. You should not act on any recommendation without considering your personal needs, circumstances, and objectives. We recommend you obtain professional financial advice specific to your circumstances.

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