Further Capital Gains Tax Changes for Foreign & Australian Residents

[4MyEgo]

The goal posts keep being moved.

 

An interesting and very confusing read for those who hold property down under.

 

https://www.ato.gov.au/general/capital-gains-tax/in-detail/calculating-a-capital-gain-or-loss/capital-gains-withholding--impacts-on-foreign-and-australian-residents/

[moojar]

Trying to stop foreign investors absconding without paying tax on real estate sales I'd say.  But as usual we will get caught up in this if we are "non resident for tax purposes" I suppose. 

 

A trap I almost fell into is selling an investment then retiring overseas in the same financial year, and spending less than half of that year in Oz.  I believe that would have made me ATO non-resident and up for a higher tax bill. 

 

Same if I own property and rent it out - no tax-free threshold, minimum 32.5% tax on every $ of 'profit'.    

[4MyEgo]

10 hours ago, moojar said:

Trying to stop foreign investors absconding without paying tax on real estate sales I'd say.  But as usual we will get caught up in this if we are "non resident for tax purposes" I suppose. 

 

A trap I almost fell into is selling an investment then retiring overseas in the same financial year, and spending less than half of that year in Oz.  I believe that would have made me ATO non-resident and up for a higher tax bill. 

 

Same if I own property and rent it out - no tax-free threshold, minimum 32.5% tax on every $ of 'profit'.    

Exactly my point, your on the ball.

 

Fortunately I sold my principal place of residence, which I first purchased as an investment, i.e. I had another property that was my principal place of residence, and when I sold that I moved into the investment property which became my principal place of residence, by doing that I reduced the capital gains tax payable over the period I lived in it, e.g. 1 year as an investment property, one year as my principal place of residence, and then again 6 months as an investment property when I moved to Thailand, fortunately for me the tax was minimal, had I hung onto it, like you said 32.5c in the $, no threshold, and full capital gains tax from the date I left the country (retrospectively).

 

Now its the Australian Stock Exchange, zero tax payable on fully franked dividends and no capital gains tax on shares, they did me a favour because I have no agents to pay commission, no vacancy factor, no maintenance, no council, or water rate bills, no insurance policies for the property and tenancy for loss of rent/damage, when you work it all out, the 32.5c in reality becomes much higher than that, and with shares you can unload when you want, if you want, or just keep taking that 5%-6% return from the blue chip stock, while also getting in and out of gold stocks to make some extra coin, goes a long way here in Thailand.

 

All I got to do now is wait for the old age pension prison term....lol

Edited May 30, 2017 by 4MyEgo