Moving to the States on an E-3 and selling your Australian home around the same time? 

There’s a simple timing difference between Australia and the US that can quietly turn a tax-free Australian sale into a taxable gain in America. 

The fix is usually straightforward—but you need to plan the dates.

Two Countries, Two Clocks

• Australia – For capital gains tax (CGT), the “disposal” of property happens when you sign the contract. If it’s your main residence, the Australian rules can often wipe out the gain at that point.
• United States – For income tax, the sale generally happens when you settle/close—the day title and the benefits of ownership pass.

If you sign in March (Australia sees the disposal then) but you don’t settle until May, the US sees a May sale.

Why E-3 Arrivals Get Caught

US tax residency doesn’t depend on your visa—it’s driven by a day-count test (the “substantial presence” test). 

In the year you meet that test, your US residency start date is effectively the first day you set foot in the US that year.

Here’s the rub:

• Before you arrive – You’re a non-resident for US tax.
• After you arrive (and once you meet the day-count) – You’re a US tax resident from that first day of presence forward.

So, if you arrive before settlement, the US treats the later settlement as a sale while you’re a resident—even if Australia already treated the sale at contract and applied the main residence exemption. 

Australia may charge no tax, leaving you with no credit to use against the US bill.

“Won’t The Treaty Save Me?”

Often not. 

The Australia–US tax treaty allows each country to tax its residents under their own rules. 

Once you’re a US resident for tax, the US can tax your worldwide gains—including your Australian home—despite Australia’s main residence outcome. 

In short: great treaty, unhelpful here.

The Good News: The US Home-Sale Exclusion

The US has its own main-home relief. 

If you owned and lived in the home for any two years in the five years before settlement, you can generally exclude up to USD $250,000 of gain (USD $500,000 for many married couples filing jointly).

A home outside the US can qualify—there’s no requirement it be on American soil.

A couple of friendly clarifications:

• You don’t need to be living there on the day of settlement. A reasonable period after moving out is fine.
• If your gain is bigger than the exclusion, the excess is taxed at US capital gains rates.

A Simple Example

March – You sign a contract to sell your Sydney home. Australia treats the disposal now, and—because it’s your main residence—there’s no Australian CGT.

April – You fly to the US to start your E-3 job. From that first day in April (once you meet the day-count), you’re a US tax resident.

May – The sale settles. The US sees a May sale while you’re a resident. Unless the US home-sale exclusion fully covers the gain, you could have US tax to pay—with no Australian credit to offset it.

What Smart Planning Looks Like

Sequence The Dates

The cleanest solution is to settle before you set foot in the US for that year. 

If that’s not possible, see if settlement can be brought forward.

Use The US Exclusion

Check whether you meet the 2-out-of-5-year ownership and use test. 

Keep tidy records of when you lived there and of any renovations/improvements (they can increase your cost base for US purposes).

Play The Day-Count Carefully

If you’ll be in the US for less than half the year, there are limited rules that may let you remain a non-resident for US tax that year (if your main ties stay in Australia). 

This is a facts-and-paperwork exercise—worth exploring before you travel.

Mind The Currency

Your US return is in US dollars, so exchange rates can make your US gain look bigger or smaller than it feels in AUD.

If you have an AUD mortgage, paying it off at settlement can create a separate US-tax currency gain or loss. It’s manageable—just don’t be surprised by it.

Quick Checklist Before You Fly

1. Ask The Agent/Solicitor – Can we accelerate settlement?
2. Map Your Days – When exactly will you land in the US? Can you delay arrival until after settlement if needed?
3. Confirm Eligibility – Do you meet the US home-sale exclusion? Gather proof of ownership, occupancy, and improvements.
4. Model The Numbers – Estimate the gain in USD and test different arrival/settlement dates.
5. Paperwork Plan – If you’ll be under 183 days in the US this year and keeping your life in Australia, ask whether an exception to US residency could apply.

Common Myths—Busted

• My visa type decides my tax.” No—the day-count does.
• “If Australia doesn’t tax it, the US can’t.” Not true once you’re a US tax resident.
• “I must be living there on settlement day to claim US relief.” Not required—you just need the 2-out-of-5-year history.

The Bottom Line

For many Aussies heading over on an E-3, the only real “trap” is timing. Australia taxes at contract, the US taxes at settlement. 

Arrive in the US before settlement and your main residence can suddenly have a US tax bill attached. 

The best defences are simple: settle before you arrive where possible, lean on the US home-sale exclusion, and plan your day-count.

Add a quick currency sense-check, and you’ll turn a potential headache into a non-event.

Singapore is consistently ranked among the most business-friendly countries in the world. With a competitive corporate tax rate of 17%, a transparent regulatory framework, and strong government support, it offers an ideal environment for entrepreneurs and growing enterprises. 

Beyond the low tax rate, small businesses and startups benefit from a wide range of targeted tax incentives designed to reduce costs, support innovation, and encourage international expansion.

This article provides a comprehensive overview of the main tax schemes available to small businesses in Singapore, together with their eligibility requirements.

Start-Up Tax Exemption Scheme (SUTE)

Overview:

The SUTE provides new companies with substantial concessions from tax during their first three Years of Assessment (YA) by exempting a portion of the first $200,000 of chargeable income. 

Benefits:

• 75% exemption on the first $100,000 of normal chargeable income.
• 50% exemption on the next $100,000.

Eligibility:

• Incorporated and tax resident in Singapore.
• Not an investment holding company or one engaged in property development for sale/investment.
• Applies only to the first three consecutive YAs.

Partial Tax Exemption Scheme (PTE)

Overview:

Once the SUTE period ends, companies can continue to benefit from ongoing relief under the PTE.

Benefits:

• 75% exemption on the first $10,000 of normal chargeable income.
• 50% exemption on the next $190,000.

Eligibility:

• Available to all companies generating active business income.
• No restrictions by industry or size.

R&D Tax Deductions

Overview:

Designed to encourage innovation, this scheme provides enhanced deductions for qualifying research and development (R&D) activities.

Benefits:

• 250% deduction for qualifying R&D expenditure conducted in Singapore.
• Additional allowances for automation projects and intellectual property registration.

Eligibility:

• Company must be tax resident in Singapore.
• R&D must be carried out in Singapore.
• Work must address scientific or technological uncertainty (routine improvements are not eligible).

Double Tax Deduction For Internationalisation (DTDi)

Overview:

Supports Singapore companies in exploring overseas opportunities.

Benefits:

• 200% tax deduction on qualifying internationalisation expenses, such as overseas trade fairs, marketing trips, and feasibility studies for overseas expansion.

Eligibility:

• Company must be incorporated and tax resident in Singapore.
• Activities must fall within pre-approved categories, or require prior approval from Enterprise Singapore or the Singapore Tourism Board.

GST Schemes And Startup SG Support

Overview:

Provides cashflow advantages for import/export businesses and funding support for startups.

Benefits:

• Major Exporter Scheme (MES) – Suspension of GST on imports for exporters.
• Import GST Deferment Scheme (IGDS) – Defer import GST until monthly GST return filing.
• Startup SG and Angel Investor Schemes – Co-funding, mentorship, and investor tax deductions to support high-growth companies.

Eligibility:

• GST schemes – Company must be GST-registered and have a strong compliance record.
• MES – Must be a major exporter with significant zero-rated supplies.
• IGDS – Must regularly import goods with consistent GST compliance.
• Startup SG – Companies under 5 years old, incorporated in Singapore, and engaged in scalable, growth-oriented activities.

Conclusion

Singapore’s tax framework gives small businesses a strong competitive edge. Whether it’s through generous start-up exemptions, ongoing relief, support for innovation, or schemes that ease cashflow and encourage expansion abroad, SMEs can take advantage of a wide variety of government-backed measures. The key is to understand the eligibility requirements and plan early so that these incentives align with your business growth strategy.

Five Key Takeaways For Small Businesses

1. Start Strong – maximise savings in your first three years through the Start-Up Tax Exemption (SUTE).
2. Maintain Relief – benefit from the Partial Tax Exemption (PTE) even after the start-up phase.
3. Invest In Innovation – leverage enhanced R&D deductions and IP incentives to scale sustainably.
4. Expand Overseas – tap into the Double Tax Deduction for Internationalisation (DTDi) when entering new markets.
5. Optimise Cashflow And Funding – use GST deferment schemes and Startup SG programmes to ease liquidity and attract investors.

Are you an Australian business looking to expand in Singapore? In this episode of Money Side Up, our Managing Director Boon Tan shares valuable insights on helping Australian companies establish and grow in Singapore. 

In this episode, our Managing Director highlights the key tax considerations for doing business across borders which focus on corporate structures, compliance, and strategic planning.  

Gain deeper insights, listen to the podcast on Spotify.