{"id":2700,"date":"2017-05-24T12:17:16","date_gmt":"2017-05-24T12:17:16","guid":{"rendered":"https:\/\/cstau.wpengine.com\/?p=2700"},"modified":"2026-04-09T07:07:13","modified_gmt":"2026-04-09T07:07:13","slug":"australian-budget-major-cgt-announcement-expat","status":"publish","type":"post","link":"https:\/\/csttax.com\/en-au\/blog\/australian-budget-major-cgt-announcement-expat\/","title":{"rendered":"Australian Expat Alert &#8211; Budget Announces Main Residence CGT Changes"},"content":{"rendered":"<h2 class=\"gmail_default\"><strong><span style=\"color: #000000;\">Background<\/span><\/strong><\/h2>\n<p>Many Australian citizens who leave Australia and become non-residents (i.e foreign residents for tax purposes) rent their former main residence while they are living overseas.<\/p>\n<div class=\"gmail_default\">Presently these Australian citizens are able to benefit from a CGT main residence exemption under the &#8216;6 year absence&#8217; concession (Section 118-145 of the ITAA 1997). \u00a0In essence the absence rule means that a person can move out of their main residence, rent it out, and then move back into it before the end of 6 years and the property will retain its 100% CGT free status when it is sold.<\/div>\n<div class=\"gmail_default\"><\/div>\n<div class=\"gmail_default\">Further, where a former main residence is not rented out at all &#8211; the property can remain exempt from CGT indefinitely (See Section 118-145(3)).<\/div>\n<div class=\"gmail_default\"><\/div>\n<div class=\"gmail_default\">CST has many expat clients who have moved overseas and who are renting out their family homes.<\/div>\n<h2 class=\"gmail_default\"><strong><span style=\"color: #000000;\">New Budget Announcement<\/span><\/strong><\/h2>\n<div class=\"gmail_default\">\n<p>On the 9 May 2017 the Treasurer announced that the Government <strong>&#8220;would stop foreign and temporary residents from claiming the main residence capital gains tax exemption when they sell property in Australia from Budget night&#8221;. <\/strong>The a transitional rule is to be provided so that people who own such property on 9 May 2017 can sell by 30 June 2019 without paying capital gains tax.<\/p>\n<\/div>\n<div class=\"gmail_default\">However the announcement was included in a series of measures aimed at improving the integrity of Australia&#8217;s CGT rules for <em><strong>foreign investors. <\/strong><\/em><\/div>\n<div class=\"gmail_default\"><\/div>\n<div class=\"gmail_default\">Naturally enough, most Australian expats living abroad would not consider themselves to be &#8216;foreigners&#8217; and the loss of a CGT exemption on their former main residence would be a very bad outcome.<\/div>\n<div class=\"gmail_default\"><\/div>\n<div class=\"gmail_default\">Unfortunately it is not yet clear whether this announcement was actually intended to apply to foreign residents (meaning foreign tax residents, which would include Australian citizens who are non-resident of Australia) or whether the\u00a0announcement is intended to apply to foreign nationals only.<\/div>\n<p>Given the lack of detail in the announcement we will have to wait until legislation is introduced before\u00a0being sure of the Governments intentions in this area. If you are an Australian expat living abroad please do not hesitate to contact us to discuss any concerns you may have or if you require advice.<\/p>\n<p>Please see &#8211;<a href=\"http:\/\/www.budget.gov.au\/2017-18\/content\/glossies\/factsheets\/html\/HA_16.htm\">\u00a0http:\/\/www.budget.gov.au\/2017-18\/content\/glossies\/factsheets\/html\/HA_16.htm<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Background Many Australian citizens who leave Australia and become non-residents (i.e foreign residents for tax purposes) rent their former main residence while they are living overseas. Presently these Australian citizens are able to benefit from a CGT main residence exemption under the &#8216;6 year absence&#8217; concession (Section 118-145 of the ITAA 1997). \u00a0In essence the [&hellip;]<\/p>\n","protected":false},"author":13,"featured_media":8234,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[14,20],"tags":[17,18,19],"class_list":["post-2700","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-australians-living-overseas","category-australian-moving-abroad","tag-cgt","tag-expat","tag-residence"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Australian Expat - Budget Announces Main Residence CGT Changes<\/title>\n<meta name=\"description\" content=\"Australian Expat Budget Announces Main Residence CGT Changes. 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