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Australians and cpital gains

Australians and cpital gains

I have a client who is an Australian national. She has lived and worked in the UK for 15 years and has now decided to return back home to live in Oz with her British husband and children.

She has owns rental property, not her prime residence, that she will be hoping to sell. She has been told, by other Aussies, that since she is returning home she will not be liable for any CGT on the gain made on the sale of her rental property.

I have been unable to verify this so far, so please can anyone either advise me or, alternatively, point me in the right direction to obtain the advise I need .  


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05th Nov 2010 19:19

Bit of clarification

I guess you are asking about CGT in the UK, and that the property is in the UK.

Provided she is non resident in the tax year of disposal then she will not be liable to UK CGT on the sale as it only applies to UK resident taxpayers. However, were she to change her mind and return to the UK within 5 years after leaving she would then be liable to tax on the gain under the short term non residence rules (which prevent you going abroad for a year to avoid CGT). I would mention this caveat.

You should be careful in the way you word your advice as there may be a CGT liability in Australia on the gain. I'm not sure as obviously their rules differ from ours, but I do know that there is a charge to CGT in Oz on some disposals. Advise her to take suitable advice.

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06th Nov 2010 01:29

Even if she is not domiciled in UK, she will be considered as fiscal domiciled for tax purposes due to her stay in UK, this is right non resident will not get taxed but she will be resident in Australia at that time and she will have to pay tax in Australia or pay in Uk and claim double taxation relief or vice versa.

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