shouldistayorgo

Beoz

You haven't sold nor made any money on that growth. How can you be liable on that?

GST is a goods a consumption tax. Not a tax on speculation.

just my take.

shouldistayorgo

goldchoccycoin

Isn't that ruling about Australian properties - not UK properties?

This seems a very strange situation if it is indeed the case that this ruling applies to UK properties, I would be getting a second opinion from another accountant or from someone like Alan Collett.

quoll

louie

The link says (as I read it), either you can treat all your non-Australian property as having been sold when you cease to be Australian resident, paying capital gains tax at that point but having no further liability on those assets when they are sold, or you can "choose to disregard all capital gains" but you will have to pay capital gains tax on that asset in Australia at the time it is sold, even though you are no longer an Australian resident. So if an asset has appreciated £50k between you becoming and ceasing to be Australian-resident, you can pay Australian CGT at that point if you wish. If you don't, and it is eventually sold for £100k more than its value at some later point, you will then have to pay Australian CGT on the whole £100k (presumably subject to whatever exemptions are available, if any). I suspect that this is widely ignored, either wilfully or in ignorance; I have no idea how it is policed.

NB: Beoz - we are talking about capital gains tax, not goods and services tax.

shouldistayorgo

Alan Collett

Yes, a cessation of residency in Australia can trigger a deemed disposal for CGT purposes - see CGT Event I1:
https://www.ato.gov.au/General/Capit...ralianresident

However, be also mindful of the provisions of the Tax Treaty between the UK and Australia, and in particular para 5 of Article 13:
Convention between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gai

What you should perhaps be doing is getting an opinion and some pro forma CGT computations under the provisions of the UK and Australia from an accountant who is across the provisions of the UK and Australia, as well as the Treaty provisions.

Feel able to ping a PM or an email to me.

Best regards.

mikelincs

That has never come up on this forum AFAIK, and I suspect doesn't really apply, once you are no longer an OZ resident how are the authorities going to know whether you have sold your UK property, or how much the value has increased unless you tell them,

Alan Collett

I take it you are not advocating doing anything unlawful, Mike ...?

Best regards.

mikelincs

What me??? Never.

louie

That says "An individual who elects, under the taxation law of (Australia), to defer taxation on income or gains relating to property which would otherwise be taxed in (Australia) upon the individual ceasing to be a resident of (Australia) for the purposes of its tax (*), shall, if the individual is a resident of the (UK), be taxable on income or gains from the subsequent alienation of that property (sale or transfer) only in (the UK)."

* - i.e. the pay it later on the whole gain on eventual sale, not just the gain in value until ceasing to be resident (but paying it at that earlier point), option

So the treaty comes in to save the OP it seems. Alan, why would he need CGT calculations?

uk_grenada

Alan Collett

Not correct - sorry.

A deemed disposal of an investment asset can take place on certain occasions, including (in Australia) the cessation of tax residency.

Best regards.

Kiwipaul

The important question is did you buy or rent a property whilst in Oz.

If you rented then you can claim your UK property as your PPOR for 6 years after you move out.

But if you bought another property in OZ then yes you are liable for the CGT on the increase on your UK property. But you will be selling your Oz property with no CGT liability which will soften the blow.