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tanyalai(Initiate)Initiate
26 July 2026

I plan to cease Australian tax residency and leave Australia on 15 October 2026.


I hold Bitcoin, which I have held for more than 12 months. I understand that ceasing residency may trigger CGT event I1, with the Bitcoin deemed disposed of at its market value on the date I cease residency. I'm not planning to make the s104-165 election to defer/disregard the I1 event.


Q1: Will the I1 deemed disposal qualify for the 50% CGT discount, given I've held the Bitcoin for more than 12 months?


Q2: If I then actually sell the Bitcoin in January 2027 (as a non-resident), does that later sale have any impact on the I1 CGT calculation or my Australian tax liability? My understanding is that I1 crystallises the gain based on the 15 October market value, and the later sale — as a non-resident and assuming the Bitcoin is not Taxable Australian Property — shouldn't create any further Australian CGT liability.


Q3 (separate topic): For my FY 2026–27 tax return, can I simply wait until after 30 June 2027 and lodge normally through myTax, rather than lodging an early paper return after leaving Australia? Is there any tax or other disadvantage to waiting?


Appreciate any clarification, particularly from anyone familiar with CGT event I1 and Australian tax residency rules.


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6 replies
70 views
6 replies

All replies

Zentime(Master)Master
26 July 2026

Assuming you hold the Bitcoin on capital account (sounds like you do) then Q1: yes discount available, assuming you have been resident for entire period of ownership until

that point. Q2: no Australian consequences once you are non-resident

Q3: you can lodge via myGov but keep your Australian bank account open for any refund as it's a pain when you don't have an Aussie bank account any more. And make sure you fill out the part year tax free threshold section in the ITR.

Liked by tanyalai
YellowPotato(Taxicorn)Taxicorn
27 July 2026

Side Note: it would be best you see tax agent or get ATO private ruling about your tax residency.


Leaving Australia doesn't necessarily mean you stop being Australian tax resident. Would need to take care to satisfy the requirements for not being a tax resident in domicile test.

Liked by tanyalai
NikkiATO(Community Moderator)Community Moderator
30 July 2026

Hi @tanyalai,


As @YellowPotato mentioned, leaving Australia doesn't automatically mean you stop being an Australian resident for tax purposes, as the residency tests and your overall circumstances need to be considered.


In relation to CGT event I1 and crypto assets, a crypto asset may become taxable Australian property where an individual stops being an Australian resident and chooses to disregard a capital gain or loss under CGT event I1. Foreign residents may have Australian CGT obligations for crypto assets that are taxable Australian property.


For your tax return, if you leave Australia during an income year can still lodge your return after the end of the financial year in the usual way. 

tanyalai(Initiate)Initiate
1 Aug 2026

@NikkiATO


Thanks for your response. I appreciate the clarification regarding lodging my tax return (Q3).


However, I don't think my questions about CGT event I1 (Q1 and Q2) were actually answered. My questions were expressly based on the assumption that I do cease Australian tax residency on 15 October 2026. I understand that whether someone ceases Australian tax residency depends on the residency tests and their individual circumstances, but that wasn't the point I was seeking clarification on.


Instead, the response appears to focus on the residency tests and the consequences of making the section 104-165 election, whereas my question specifically stated that I do not intend to make that election.


As a result, I'm still unable to determine whether my understanding of Q1 and Q2 is correct. If these questions can't be answered through this forum, would the ATO recommend applying for a private ruling? I'd prefer to obtain certainty before disposing of the Bitcoin, rather than later discovering that I misunderstood the availability of the 50% CGT discount or the operation of CGT event I1 after selling it as a foreign resident. If a private ruling is the appropriate avenue, should I apply well before my planned departure date of 15 October 2026, or is it appropriate to apply after that date?

PollyATO(Community Support)Community Support
4 Aug 2026

Hi there @tanyalai,


You're right, with your scenario we can't give a definitive answer here.


If you're seeking certainty before disposing of the Bitcoin, a private ruling may be appropriate. A private ruling allows us to consider your specific facts and provide advice on how the tax law applies to your situation.


If you decide to apply for a private ruling, doing so before the relevant event happens would give you certainty before making decisions based on the tax outcome. Allow time for the rulings process. We aim to issue private rulings within 28 calendar days once all required information is received, but complex matters can take longer.

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Question about CGT event I1 and leaving Australia | ATO Community