Compare taxes and see how much you save moving from Florida to Australia
Florida residents pay $0 in state income tax while Australians pay approximately $23,000 in national income tax (plus 2% Medicare levy) at a $100,000 USD equivalent income. Florida's tax advantage is real but partial — US federal income tax of around $17,400 still applies to all Americans at $100,000 income. When comparing total tax burdens, the combined Australian rate (~$23,000) actually exceeds the US federal-only burden for Floridians, making the state tax savings less transformative than they appear. Florida retirees considering Australia should weigh the higher income tax against Australia's universal Medicare healthcare system, excellent quality of life, and strong pension (superannuation) system.
No State Income Tax
No state income tax — one of 9 US states with no state-level income tax.
Progressive National Tax
Tax-free threshold AUD$18,200, then 16% to 45% at top bracket, plus 2% Medicare levy on most taxpayers.
At $100,000 income:
Australia's national income tax is ~$23,000 at $100,000 USD equivalent vs Florida's $0 state tax. Floridians moving to Australia: US federal tax still applies in Australia. Net advantage depends on whether total Australian rates exceed US federal (at $100K, Australian ~$23K vs US federal ~$17,400 — Australia more expensive). Medicare levy included.
| Income | FL Tax | AU Tax | Savings | 10-Year |
|---|---|---|---|---|
| $50,000 | $0 | $8,000 | -$8,000 Australia costs more | -$80,000 |
| $75,000 | $0 | $14,000 | -$14,000 Australia costs more | -$140,000 |
| $100,000 | $0 | $23,000 | -$23,000 Australia costs more | -$230,000 |
| $150,000 | $0 | $38,000 | -$38,000 Australia costs more | -$380,000 |
| $250,000 | $0 | $68,000 | -$68,000 Australia costs more | -$680,000 |
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Transfer Money Internationally →Yes — the United States taxes its citizens on worldwide income regardless of country of residence. An American living and working in Australia must still file a US federal tax return every year. The US-Australia tax treaty and foreign tax credit provisions prevent double taxation: Australian tax paid can be credited against the US tax liability on the same income. Because Australian income tax rates at most income levels exceed US federal rates, the foreign tax credit typically eliminates any remaining US tax. However, FBAR reporting for Australian bank accounts and FATCA compliance for Australian superannuation funds are mandatory annual obligations.
Australia's Medicare levy is 2% of taxable income, paid by most Australian residents to fund the universal healthcare system. At $100,000 USD equivalent, the Medicare levy adds approximately $2,000 to the tax bill. In return, residents receive access to Medicare — free or subsidised treatment at public hospitals, heavily subsidised GP visits through bulk billing, and the Pharmaceutical Benefits Scheme (PBS) which caps prescription drug costs. For Americans accustomed to paying $500-$1,500 per month in health insurance premiums, the Medicare levy represents exceptional value, partially offsetting Australia's higher income tax rates.
Superannuation is Australia's mandatory employer-funded retirement savings system. Employers are required to contribute 11.5% of an employee's ordinary earnings into a super fund (rising to 12% by 2025-26). This is in addition to the employee's salary, not deducted from it — making it a substantial employer-funded retirement benefit. By comparison, US employers typically contribute 3-6% to 401(k) plans. Americans moving to Australia on a temporary visa may be eligible to withdraw their accumulated super as a Departing Australia Superannuation Payment (DASP) when they leave, though it is taxed at 35-65% — making superannuation strategy important for temporary residents.
Yes — Americans living in Australia can claim the Foreign Earned Income Exclusion (FEIE) under IRS Form 2555 if they meet the Bona Fide Residence test (genuine Australian resident) or the Physical Presence test (330 days outside the US in 12 months). The 2025 FEIE exclusion limit is $126,500. However, many Americans in Australia find the Foreign Tax Credit (Form 1116) more advantageous than FEIE, especially at higher incomes, because Australian tax rates typically exceed US federal rates — meaning the foreign tax credit fully offsets US liability without using up the FEIE exclusion. Consult a US expat tax professional for the optimal approach.
The most common pathways for Americans to live in Australia long-term include the Skilled Independent Visa (subclass 189), Skilled Nominated Visa (subclass 190), and Employer Sponsored visas (subclass 482, 186). Australia also offers the Global Talent Independent Program for exceptional achievers in high-value sectors. Retirees and those seeking a lifestyle move face more challenges — Australia does not have a retirement visa specifically, though the Investor Retirement Visa (subclass 405) exists for applicants over 55 with significant assets. Working Holiday visas (subclass 417) are available for Americans aged 18-30 (or 35 for some) for up to 3 years with extensions.
The cost comparison between Florida and Australia involves significant tradeoffs. Australia's major cities — Sydney and Melbourne — have among the world's most expensive housing markets, comparable to Miami or Fort Lauderdale. Consumer goods, groceries, and dining out are generally 20-30% more expensive in Australia due to import costs, higher wages, and geographic isolation. However, Australia's universal Medicare dramatically reduces healthcare costs compared to private insurance in Florida. Florida's property insurance and HOA costs in hurricane-prone areas can be very high. For retirees, Australia's quality public services partially offset its higher consumer prices.
The US-Australia Double Taxation Convention (originally signed 1982, updated protocols since) establishes clear rules for which country has taxing rights on various types of income. For employment income, the country where work is performed typically has primary taxing rights. The treaty also sets reduced withholding tax rates on dividends, interest, and royalties flowing between the two countries. A key provision for Americans in Australia is the foreign tax credit coordination — taxes paid to Australia can be credited against US tax on the same income. The treaty also covers pension income, ensuring Australian superannuation distributions are not double-taxed. Importantly, the US 'saving clause' means the US retains its right to tax American citizens regardless of the treaty.