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Taxduck(Taxicorn)Taxicorn
19 May 2026

"do i have to pay CGT..?"


Most likely that won't be the case. If your parents follow the correct procedures and tax rules then they will likely end up paying all the taxes (including CGT).

That is due to foreign resident capital gains tax withholding (FRCGW). Under this

" the purchaser must withhold up to 15% of the sale (or market value if not sold at arm's length) for foreign resident capital gains withholding (FRCGW) purposes."

Australian residents and clearance certificates | Australian Taxation Office

As you are a foreign resident you are unable to obtain a clearance certificate, so the purchasers (your parents) will be required to remit 15% (of your share of ownership) of the market value of the property to the ATO on the date of transfer. This could well be north of $50,000.

This withholding is used to help cover any CGT applicable on the transfer.

Your parents may well rethink asking you to "gift them the house back".

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rafadal(Newbie)Newbie
21 May 2026

Hi all, and thanks for your contribution

A quick update on my research, and any feedback will be helpful

I received advice from a tax agent, they describe themselves as Expat tax specialists, helping Australians living and working overseas manage complex cross-border tax obligations. They assist with determining ATO tax residency status, correctly applying Double Taxation Agreements (DTAs), and navigating Capital Gains Tax (CGT) rules regarding foreign assets or Australian assets

Their reply was the following

We understand your background as follows:

The property is owned 50:50 with your sister

Property was acquired in 2020

You started a job in NZ in 2023

You own another two investment properties situated in Australia, both of which have been rented out

Your main residence property in Australia has not been rented out, nor sold

You are with an Australian industry super fund, and you still maintain the account; and

The ‘gifting to parents’ idea is just a plan at this stage, and hasn’t been actioned.

All the above-mentioned circumstances are correct and true. This is my reply

As discussed briefly in the call, we need to first understand your tax residency, as moving overseas for work doesn’t necessarily mean you become a non-resident for Australian tax purposes. Australian residency law is complex and detailed oriented; there are [Removed by moderator] tests, and you must fail all of them to become a tax non-resident.

In the case that you remain a tax resident of Australia while also being treated as a tax resident of another country, and a double tax agreement is in place between the two countries, it is necessary to apply the hierarchical tie‑breaker tests to determine your primary tax residency. Under the Australia–New Zealand Double Tax Agreement (DTA), an individual who is a tax resident of both countries is deemed to be a resident of only one country for tax purposes. Does

anyone agree that this advice is correct? However, this is just advice rather than a guaranteed outcome

· Would it make any difference if we sold the property to the parents rather than gift it?

Thanks all in advance

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RE: Is CGT payable on a home that is not an investment? | ATO Community