Compare taxes and see how much you save moving from California to Australia
California has the highest state income tax in the US, yet Australia's national income tax is still significantly higher — approximately $23,000 USD at $100,000 income versus California's $5,762 state tax. When you include US federal tax, total California burden (state + federal) is approximately $23,106 at $100K — remarkably close to Australia's $23,000 national rate. Australia's tax-free threshold starts at AUD$18,200 (~$11,800 USD), providing relief at lower incomes, while higher earners face rates up to 45%. Americans moving from California to Australia face the same US federal tax obligation in both locations — worldwide income is taxable by the US regardless of residency. The US-Australia tax treaty and foreign tax credits typically prevent double taxation. Australia's significant advantage: Medicare (universal healthcare), which California residents must fund separately through private insurance.
Highest US State Tax
9 progressive brackets from 1% to 13.3%
Progressive Tax System
Tax-free threshold AUD$18,200, then 16% to 45% at top
At $100,000 income:
California state income tax ($5,762) is lower than Australia's national income tax (~$23,000) at $100,000 USD. Adding US federal tax, total CA burden (~$23,106) is almost identical to Australia's national tax. US expats in Australia use foreign tax credits to avoid paying both in full.
| Income | CA Tax | AU Tax | Savings | 10-Year |
|---|---|---|---|---|
| $50,000 | $1,711 | $8,000 | -$6,289 Australia costs more | -$62,890 |
| $75,000 | $3,349 | $14,000 | -$10,651 Australia costs more | -$106,510 |
| $100,000 | $5,762 | $23,000 | -$17,238 Australia costs more | -$172,380 |
| $150,000 | $10,991 | $38,000 | -$27,009 Australia costs more | -$270,090 |
| $250,000 | $22,471 | $68,000 | -$45,529 Australia costs more | -$455,290 |
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Transfer Money Internationally →Yes. All US citizens and green card holders must file a US federal tax return regardless of where they live. Moving to Australia does not end your US tax obligation. The US-Australia tax treaty and foreign tax credits typically prevent double taxation — most Americans in Australia end up paying Australian rates (which are generally higher at equivalent incomes) with foreign tax credits offsetting any US liability.
Australia uses a progressive income tax system with a tax-free threshold of AUD$18,200 (~$11,800 USD). Above that: 16% to AUD$45,000, 30% to AUD$135,000, 37% to AUD$190,000, and 45% above. A 2% Medicare levy applies to most taxpayers on top of income tax, funding the universal healthcare system. Australian taxes are assessed in AUD — exchange rate fluctuations affect USD comparisons.
Yes. Australia's Medicare levy (2% of taxable income for most residents) funds universal healthcare. Medicare covers most medical services, public hospital care, and subsidised medicines through the Pharmaceutical Benefits Scheme (PBS). Californians moving to Australia gain access to this system after completing a 2-year waiting period for Medicare eligibility as a permanent resident, or upon becoming an Australian citizen.
The US-Australia Tax Convention prevents double taxation on most income types. Americans living in Australia can claim foreign tax credits on their US return for Australian income taxes paid. Since Australian tax rates typically exceed US rates at equivalent incomes, most Americans in Australia owe minimal additional US tax after credits — but the annual US filing obligation remains.
The Foreign Earned Income Exclusion (FEIE, IRS Form 2555) allows qualifying US expats to exclude up to $126,500 (2024) of foreign earned income from US federal tax. For Australian-based Americans, since Australian rates often exceed US rates, it's generally more advantageous to use the Foreign Tax Credit rather than the FEIE. Consult with a US expat tax specialist like Greenback before choosing.
Ending California tax residency requires establishing domicile elsewhere and meeting multiple tests. Simply moving to Australia is insufficient. You must change voter registration, driver's license, and professional licenses, and minimise California ties. The California Franchise Tax Board aggressively pursues high-income former residents and can audit departure-year and subsequent returns.
Sydney and Los Angeles have comparable costs for housing and everyday expenses. Sydney housing has moderated since its peak but remains expensive. LA tech salaries in USD typically exceed Sydney equivalents in AUD. After accounting for universal healthcare, higher Australian income tax, and the AUD/USD exchange rate, the net financial outcome of moving from LA to Sydney depends heavily on your specific income, industry, and lifestyle choices.