• Ceasing to be an Australian resident

    If you go overseas and cease to be an Australian resident, or a resident trust for capital gains tax (CGT) purposes, you are taken to have disposed of certain assets for their market value at the time you cease being an Australian resident.

    If you ceased being an Australian resident or a resident trust for CGT purposes:

    • before 12 December 2006, we treat you as though you disposed of each of your assets that did not have the necessary connection with Australia for their market value at the time you ceased being a resident
    • on or after 12 December 2006, we treat you as though you    
      • disposed of each of your assets that are not taxable Australian property for their market value at the time you ceased being a resident
      • immediately re-acquired indirect Australian real property interests and options or rights to acquire such interests for their market value.
       

    Exemption for a temporary resident who ceases being an Australian resident

    There is an exception for temporary residents. If you are a temporary resident when you cease to be an Australian resident, we do not treat you as though you disposed of any of your assets.

    Exemption for a short-term resident who ceases being an Australian resident

    If you are an individual who was in Australia on 6 April 2006 and have remained here as an Australian resident since that date, you can disregard any capital gain or capital loss if you

    • were an Australian resident for a total of less than five years during the 10 years before you stopped being one, and
    • either    
      • owned the asset before last becoming an Australian resident, or
      • inherited the asset after last becoming an Australian resident.
       

    Choosing to disregard capital gains and capital losses when you cease being an Australian resident

    If you are an individual, you may choose to disregard all capital gains and capital losses you made when you stopped being a resident.

    If you ceased being a resident and you make this choice, the assets are taken to be taxable Australian property until the earlier of:

    • a CGT event happening to the assets (for example, their sale or disposal), or
    • you again becoming an Australian resident.

    The effect of making this choice is that when working out your capital gains and capital losses on those assets, we take into account the increase or decrease in the value of the assets from the time you cease being a resident to the time:

    • of the next CGT event, or
    • you again become a resident.

    The way you complete your tax return is sufficient evidence of your choice. For more information, see Choices you make under capital gains tax.

      Last modified: 24 Jun 2016QC 16742