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Edited version of private advice
Authorisation Number: 1051818561395
Date of advice: 19 March 2021
Ruling
Subject: Assessable income
Question
Does Australia have a taxing right under Article X of Country Z Convention in respect of capital gains which arise from the disposal of assets which were acquired while you were a resident of Australia but disposed of while you were a Country Z resident, where you made a choice under subsection 104-165(2) of the Income Tax Assessment Act 1997 to disregard making a capital gain on the assets upon cessation of Australian residency for tax purposes?
Answer
No. Australia does not have any taxing rights on any capital gain made on the disposal of assets you purchased while a resident of Australia for taxation purposes.
Article X of the Double Tax Agreement between Australia and Country Z gives Country Z the sole taxing rights on any capital gain made on the assets.
This ruling applies for the following period:
Year ending 30 June 2021
The scheme commences on:
1 July 2020
Relevant facts and circumstances
You are currently a non-resident of Australia for taxation purposes.
You are currently a resident of the Country Z for the purposes of the Double Taxation Agreement (DTA) between Country Z (XXX) and Australia.
You are not a resident of any other countries for the purpose of the DTA.
You purchased CGT assets when you were a resident of Australia for taxation purposes.
You made an election under Section 104-165 to defer any CGT made on the disposal of the assets when you left Australia.
You have disposed of the assets while being a resident of Country Z.
Relevant legislative provisions
International Tax Agreements Act 1953
Income Tax Assessment Act 1997 subsection 104-165(2)
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