Contact UsI am moving to Australia permanently however won't be selling my home in the United States before I leave. Will I have to pay Capital Gains Tax in Australia when I sell?
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Tax Professional Answers
Sara Rumble
If the property is your principle place of residence ( or family home that you have lived in) and is the only residence you own there is an exemption form paying any Capital Gains Tax for six years. If the property is held for over six years the tax will be apportioned accordingly however you would be able to access the 50% general CGT discount reducing tax payable.
Only one property can access the Principle Place of Residence Capital Gains Tax exemption so if you own two places at any one time (and both have been used as your home) a choice will need to be made on which property will hold the exemption. It is a good idea to have the property valued by a registered valuer at the time of moving to Australia - real estate and/or builder valuations are not sufficient. I hope this helps and please let me know if you would like to discuss your situation in more detail
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542 weeks ago
Only one property can access the Principle Place of Residence Capital Gains Tax exemption so if you own two places at any one time (and both have been used as your home) a choice will need to be made on which property will hold the exemption. It is a good idea to have the property valued by a registered valuer at the time of moving to Australia - real estate and/or builder valuations are not sufficient. I hope this helps and please let me know if you would like to discuss your situation in more detail
Fred Rollo
If you are moving to Australia permanently, the answer to your question will depend upon whether you intend to buy a "principal residence" in Australia. In this connection, Australia has a capital gains exemption for the residence that you nominate as your "principal residence". This can be a house, apartment, mobile home, or even a houseboat.
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538 weeks ago
Your intention to "move to Australia permanently" means you will become "resident" for tax purposes. If you are a US citizen, this will mean you would have worldwide tax obligations to both Australia and US. Treaty and local tax provisions should eliminate double taxation that might otherwise occur. When you take up residence in Australia, all your worldwide assets become liable to Australian capita gains tax as if you acquired them on the day of arrival, at their respective market values on that day. Getting valuations is recommended.
As Sara Rumble has flagged in her response, the legislation does not specify that the residence subject to the exemption must be in Australia. Accordingly, as she suggests, if you nominate your current US residence as your main residence, you may have a 6-year window to maintain the Australian exemption on your retained US home. Alternatively, there is a 6-month changeover window where both your US home and any new Australian residence could both be regarded as your "principal residence".
Bear in mind that if you have pension or retirement funds, there will be Australian tax issues. Depending on the US tax implications, you may be able to roll those interests into an Australian fund. You can have a personal or family self managed fund here.
Leave a message in my Tax Boardroom on this site if you need any clarification/s.