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Re: Transfer international shares, when moving overseas

Initiate

Views 1798

Replies 4

I'm moving overseas. I own some US shares held in CommSec, that I will need to transfer to an overseas broker.

Will this be a CGT event?

At the time of departure I will have owned the shares for just under 1 year. If the transfer is a CGT event, what will be the date of the event: Will it be the day of departure from Australia or the date of the transfer?

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee

Replies 1

Tax returns are fine. Just keep documentation on calculation and decision - in case the ATO asks later.

 

If you take the election to disregard capital gains on change of residency, the shares are treated as Taxable Australian Property during your period of non-residency (for tax purposes) until you sell it. As a non-resident, you lose accesss to the 50% CGT discount. You are also subject to FX risk since the calculation for tax are translated to AUD.

 

Also if you owned a property which you treated as you main residence - you lose the main residence exemption (which exempts cgt on the sale of your principal place of residence). If you held the property on 9 May 2017, this rule kicks in if you sell the property after 30 June 2020.

 

Oh and depending on the quantum of shares held, you might want to seek formal advice (on the treatment of your assets and the change in residency).

4 REPLIES 4

Devotee

Replies 3

changing broker = no change in beneficial ownership = not a taxing event.

 

Changing tax residency: Are you going to have a CGT I1 election in place?

 

see here.

Initiate

Replies 2

Thanks a lot.

 

It looks like the best solution for me will be to transfer the stock, "Choosing to disregard capital gains and losses" until I held the stock for 1 year. To make this choice, all I have to do is complete my tax return right.

 

Are there any obvious caveats to this?

Most helpful response

Devotee

Replies 1

Tax returns are fine. Just keep documentation on calculation and decision - in case the ATO asks later.

 

If you take the election to disregard capital gains on change of residency, the shares are treated as Taxable Australian Property during your period of non-residency (for tax purposes) until you sell it. As a non-resident, you lose accesss to the 50% CGT discount. You are also subject to FX risk since the calculation for tax are translated to AUD.

 

Also if you owned a property which you treated as you main residence - you lose the main residence exemption (which exempts cgt on the sale of your principal place of residence). If you held the property on 9 May 2017, this rule kicks in if you sell the property after 30 June 2020.

 

Oh and depending on the quantum of shares held, you might want to seek formal advice (on the treatment of your assets and the change in residency).

Initiate

Replies 0

If I loose the cgt reduction there won't be a point in doing that. Hopefully the proceeds will go to schools and not coal subsidies.

 

Thanks again.