12 May 2025
Moving to Austria offers Filipinos better job opportunities, higher living standards, and the ability to support their families back home. While sending money to the Philippines remains a priority, many overseas Filipinos also dream of retiring comfortably in their homeland. But how do you build a retirement fund in the Philippines without falling into tax complications between two countries? Let's unpack this important topic.
Early retirement planning offers financial stability, peace of mind, and tax efficiency. For most Overseas Filipino Workers (OFWs), retirement back home in the Philippines is the ultimate goal. But waiting until later in life to start planning can limit your options. Creating a retirement fund while earning abroad not only helps you take advantage of foreign income but also ensures you’re setting aside money while you're in a higher-earning phase of life.
Filipinos in Austria often enjoy relatively higher incomes compared to those back home, and with proper planning, even modest monthly savings can accumulate into a substantial retirement fund when invested wisely. However, blindly transferring money back home without understanding the tax implications can create financial problems later.
Yes, you can send money to Philippines from Austria, but it's essential to comply with the Philippines-Austria tax treaty and local regulations.
Sending money to the Philippines for personal savings or investment is completely legal. However, large financial transfers can attract scrutiny from both Austrian and Philippine tax authorities if not documented properly. Fortunately, Austria and the Philippines have a Double Taxation Agreement (DTA) in place. This ensures you’re not taxed twice on the same income.
The key is to ensure that your savings for retirement are either tax-exempt or taxed only in one country as per the DTA terms. The agreement covers pensions, interest, dividends, and other income sources. You can read more about this treaty on Austria's official tax portal here.
There are several financial vehicles that allow you to grow your retirement fund effectively.
Here are some of the most common and recommended methods:
Open a non-resident account with a reputable bank like BDO, BPI, or Metrobank. These accounts allow Filipinos abroad to safely deposit money and even earn interest on their savings. However, make sure the account type qualifies for tax exemptions under the tax treaty, and always declare your funds properly.
If you're still an active SSS member, consider contributing to voluntary schemes like the Flexi Fund or PESO Fund, which are tax-sheltered and specifically designed for OFWs.
Managed by banks and financial institutions, these pooled investments provide long-term returns. Make sure to pick funds registered under the Philippine SEC and ideally managed by institutions partnered with banks in Austria.
Buying property in the Philippines can offer you rental income now and a home later. However, ensure proper documentation and tax compliance, especially if you sell it in the future.
Some Philippine insurance companies offer OFW-targeted plans combining life insurance and retirement savings. Always check if these are recognized under international tax treaties. Avoid transferring lump sums blindly. Instead, use a structured and trusted channel like online money transfer from Austria to Philippines to document your transfers and avoid red flags.
They provide guidelines on which country can tax specific types of income and under what conditions.
The tax treaty ensures you're not double-taxed on the same income. However, each type of income (pension, property gains, interest) has its own tax treatment. According to the OECD Model Tax Convention, retirement income is typically taxed only in the country of residence, but there are exceptions.
Key points include:
Always consult a licensed tax advisor familiar with both Austrian and Philippine tax laws to optimise your retirement planning strategy.
Yes, many Philippine banks and government agencies offer services tailored for OFWs and migrants. Opening an OFW account from Austria is possible through embassies or online banking portals. These accounts often come with perks such as waived fees, higher interest rates, and simplified documentation. The SSS Flexi Fund, for example, is open to overseas workers who are existing SSS members.
You will typically need:
To simplify funding these accounts, you can send money to Philippines online from Austria using trusted and licensed remittance providers.
Keeping records and using licensed remittance providers are essential to stay compliant.
Many tax penalties arise due to a lack of proper documentation, exceeding undeclared thresholds, or using informal remittance channels. Here's how to avoid trouble:
Properly routed and documented transactions are less likely to attract tax penalties or complications.
Security, transparency, and speed make ACE the preferred remittance partner for Filipinos abroad.
When planning something as important as retirement, your money deserves a secure and fast transfer service. ACE Money Transfer not only offers competitive exchange rates and lower fees but also ensures legal compliance and full transparency throughout the transaction.
With 4.8+ ratings on Trustpilot, ACE Money Transfer has earned the trust of thousands of Filipinos living overseas. Their platform makes it easy to manage your funds and track your transactions from Austria to the Philippines.
Building a retirement fund back home while living in Austria doesn’t have to be overwhelming. Understanding your legal obligations, making informed choices, and using secure platforms like ACE Money Transfer can make the entire process smoother. Whether it's through SSS, savings, or property, the key is consistency and compliance. So take the first step today and send money to Philippines from Austria with confidence.
Yes, as long as the mutual fund is legally registered in the Philippines and you follow the appropriate documentation, you can invest from abroad.
No, personal remittances are generally not taxed, but large or irregular transactions should be documented to avoid issues.
Yes, especially for investment-linked accounts or insurance plans that involve taxable interest or earnings.
Ensure your remittance provider is licensed by Austria’s Financial Market Authority and listed with the Bangko Sentral ng Pilipinas.
Failure to declare foreign income may lead to penalties, interest, or audits. It’s best to consult a dual-country tax expert for guidance.
