Hi there,
I recently moved to the Netherlands, which has a tax treaty with Australia. I am reviewing my 2024–25 Australian tax return and expect that I ceased to be an Australian tax resident when I moved. I intend to amend my return accordingly and would like clarification on how the CGT rules apply in my situation.
1) CGT on shares after ceasing residency
If I elect to treat my CGT assets (shares) as having been disposed of when I ceased to be a resident under section 104-160 (the “deemed disposal” rule), can you please confirm:
- Am I correct that any future gains or losses that arise after ceasing residency are not taxable in Australia as they are not Taxable Australian Property?
2) Cost base and CGT discount when I later become a resident again
If I return to Australia and again become a tax resident without having sold the shares overseas:
- Does Australia treat those shares as being re-acquired at market value on the day I again become a resident?
- Or does the original cost base (up to the deemed disposal point) continue to apply?
- In other words, is the cost base on re-entry reset to the market value on the date I recommence residency, so that any future CGT liability only relates to gains made after that date?
- If the cost base resets on re-entry, does the 12-month period for the CGT discount also restart from that re-entry date, meaning I would need to hold the shares for 12 months after resuming residency to qualify for the 50% CGT discount?
3) Shares acquired while I am a non-resident
If I buy and sell shares through Australian brokers while I am a non-resident for tax purposes:
- Are capital gains or losses on these shares ignored for Australian tax purposes?
- Are these shares also treated as being “re-acquired” at market value if I still hold them when I become a resident again?
Thank you in advance!
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