Supporting article Coming 25 Aug 2026
Most people organise the shipping container, the visa, the schools and the farewell drinks. The tax side gets a vague thought somewhere over the Indian Ocean, usually beginning with the words "I should probably check whether . . . ". That is a shame, because the period before your tax residency changes is usually the best planning window you will get. Many of the most expensive expat tax problems begin with a decision that was easy to make properly before departure and painful to repair afterwards.
This guide is for Australians and permanent residents moving overseas, whether that is a two-year posting or a one-way ticket. Here is what it will help you get right:
Work through the sections below, or jump to the part that matches your situation. And if you are leaving soon, the timing genuinely matters, so do not leave this to the departure lounge.
Book an appointment with our specialist team, or keep reading first. No pressure either way.
People leave in different circumstances. Find yours:
Here is the misunderstanding that causes more expat tax grief than anything else, so let us deal with it before we go anywhere near your investments.
Getting on a plane does not end your Australian tax residency. Neither does buying a place overseas, changing your postal address, closing a gym membership, or telling everyone at your farewell that you are gone for good. Australian tax law runs its own residency tests, and they are considerably harder to satisfy than “I left”.
The tests look at the whole arrangement. The duration and character of your move. The homes available to you. Where your family and belongings are. Your work, your routines and the ties you keep in Australia. There is no universal number of days overseas that decides it, and no departure form that conclusively makes you a foreign resident. Residency is a conclusion drawn from the facts.
The practical consequence catches people badly. You can live overseas for years and still remain an Australian tax resident, leaving you exposed to Australian tax on worldwide income, subject to any applicable tax treaty. So the first job is working out, on your actual facts, whether your Australian tax residency will cease and, if it does, the date that happens. Everything in the rest of this guide hangs off that answer. Our detailed guide to being an Australian resident for tax purposes explains the broader framework.
This is the one that makes people sit down.
When you cease being an Australian tax resident, the law can treat you as having sold certain assets at their market value on that date, even though you have sold precisely nothing. That deemed disposal can produce a real capital gains tax liability in your departure-year return on gains that exist entirely on paper.
Consider a share portfolio that has grown nicely over a decade. You accept a job overseas and cease Australian tax residency. Australia may tax the accumulated gain at that point, without providing the useful administrative detail of any sale proceeds with which to pay it.
There may also be a choice that changes when and how Australia taxes the affected assets. It is not a free delay. It can leave future growth exposed to Australian capital gains tax and produce a materially different result when an asset is eventually sold.
The right answer depends on the assets, their cost bases, expected growth, how long you expect to remain overseas, whether you intend to return and how the destination country will tax the same gain. Have that conversation before your residency changes, because the useful planning window narrows sharply afterwards.
If you own Australian property, the keep-or-sell question deserves a proper look before you go, not a shrug and a property manager.
Australian rental income stays taxable in Australia whether you are a resident or not, so you will generally keep lodging returns here. Report the gross rent and claim your deductions separately. The bigger shift is the rates. For 2026–27, a foreign resident receives no tax-free threshold and is taxed from the first dollar.
| Taxable income | Rate |
|---|---|
| $0 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| Over $190,000 | 45% |
The main residence exemption is generally denied where the seller is a foreign resident at the relevant time. What generally matters is your tax-residency position when the sale contract is entered into, not the settlement date. Entering into the contract while you are still an Australian tax resident can produce a very different result from entering into it after your residency has ceased. For a family home held for many years, the sequencing can change the tax result by a substantial amount.
There is also a withholding regime to know about. On a sale of Australian real property, the purchaser is generally required to withhold 15% of each vendor’s share of the sale price unless an Australian-resident vendor provides a valid clearance certificate.
Once you are a foreign resident, Australia generally taxes Australian-sourced income and amounts caught by particular rules, rather than your worldwide income. The common categories behave differently.
Fully franked dividends are the good-news story. They are generally not taxed again in Australia when paid to a foreign resident because the company has already paid tax on the underlying profits. The franking credits are not refundable, but no further Australian tax is ordinarily payable on the fully franked amount.
Interest is generally subject to 10% final withholding tax. Unfranked dividends are generally subject to 30% withholding, although an applicable treaty commonly reduces the dividend rate to 15%. Where the correct final withholding tax has been deducted, the income ordinarily does not need to be included in an Australian return.
Tell your bank, share registry and other Australian payers when your tax residency changes, and give them your overseas address. If their records are wrong, withholding may be missed, applied at the wrong rate or calculated without the appropriate treaty treatment.
Some obligations pack themselves and come along whether you invite them or not.
A HELP debt, VET Student Loan or Australian Apprenticeship Support Loan does not pause because you moved. If you leave Australia intending to be overseas for at least 183 days, you generally need to notify the Tax Office within seven days after leaving. After that, you report your worldwide income each year or lodge the applicable non-lodgment advice.
If you are an Australian citizen or permanent resident, you cannot access your super early simply because you have left the country. Your super stays where it is, under the same preservation rules, until you reach preservation age and retire or meet another condition of release. Our guide to accessing Australian super from overseas covers the ground.
A full-year foreign resident is generally not liable for the Medicare levy. The trap is for people who remain Australian tax residents while living overseas and cancel or suspend their private hospital cover. Overseas medical insurance does not count as private patient hospital cover for surcharge purposes.
Australia participates in the automatic exchange of financial account information through a system involving more than 100 jurisdictions. We explain it further in our guide to the Common Reporting Standard and Australian expats.
The financial year in which you leave is often a part-year residency year, and it is a different animal from an ordinary return.
You may be an Australian resident for one part of the year and a foreign resident for the remainder, with different rules applying to each period. If that occurs, the tax-free threshold is adjusted. Income derived while you were a resident may be taxed on a worldwide basis, while the foreign-resident period generally focuses on Australian-sourced income and other amounts that remain taxable here. Any taxable departure gain or relevant departure choice must also be dealt with in this return.
Standard tax software can process all of this with great confidence. Confidence, unfortunately, is not one of the residency tests.
The capital gains tax and residential-property rules change from 1 July 2027 under the Treasury Laws Amendment (Tax Reform No. 1) Act 2026.
For assets already held at that date, the old and new capital gains tax regimes can operate side by side. Growth attributable to the earlier ownership period may continue to receive the existing discount under transitional rules, while later growth may instead receive an inflation-based cost-base adjustment.
The same reforms also restrict the use of rental losses from some established residential properties. Whether those restrictions apply depends mainly on when the property was acquired and whether it is a qualifying new build.
If you are leaving Australia while holding shares, property or other assets you expect to sell after 1 July 2027, your residency position can materially alter the result. Put that decision into the plan now rather than reconstructing it later from passport stamps and optimism.
Assuming that leaving Australia automatically made you a foreign resident. It is a tax conclusion, not a boarding pass.
Treating the flight date as the residency-cessation date without examining the facts.
Discovering the departure capital gains tax event only after a bill appears for assets that were never sold.
Treating the departure choice as a simple deferral without modelling the future growth that may remain exposed to Australian tax.
Entering into a contract to sell a former home on the wrong side of the residency date and potentially losing the main residence exemption.
Failing to tell banks and share registries when tax residency changes, leaving withholding to be handled incorrectly.
Reporting net rent instead of gross rent with deductions shown separately.
Cancelling or suspending private hospital cover while remaining an Australian tax resident and unexpectedly risking the Medicare levy surcharge.
Forgetting the study-loan notification and annual reporting obligations.
Believing that leaving Australia unlocks superannuation. For citizens and permanent residents, it does not.
Leaving the planning until after residency has changed, when many of the useful choices have narrowed or disappeared.
Detailed supporting guides are publishing throughout 2026. Each card below goes live on its scheduled date.
Read the detailed guides below if your situation is more specific:
Related pillar guides: our non-resident tax return guide and our returning to Australia tax checklist.
By applying the residency rules to your actual circumstances. The answer depends on the duration and character of the move, the homes available to you, family, work, belongings, routines and continuing Australian ties. There is no universal number of days overseas that settles it and no departure form that conclusively declares it. Because almost everything else follows from this answer, it should be assessed rather than assumed.
Possibly. Ceasing Australian tax residency can trigger a deemed disposal of certain assets at market value, creating a capital gains tax liability without an actual sale. Australian real property is generally treated differently. There may be a choice that changes the result, but it can also expose later growth to Australian tax. The choice should be modelled before residency changes, not described afterwards as an unfortunate surprise.
It depends, and the difference can be substantial. The main residence exemption is generally denied where the seller is a foreign resident at the relevant time. What generally matters is your residency status when the sale contract is entered into, not merely when you move or settle. Obtain the sequencing advice before listing the property or signing a contract.
Often, though not always. Australian rental income, Australian business income that remains taxable here and capital gains on Australian real property will commonly require a return. If your only Australian income is interest or unfranked dividends from which the correct final withholding tax has been deducted, a return may not be required merely for that income. The answer can change from year to year.
Not if you are an Australian citizen or permanent resident. Your super remains subject to the usual preservation rules regardless of where you live. The early-access payment some people have heard about applies to eligible former temporary residents, not to citizens and permanent residents moving overseas.
It follows you. If you leave intending to be overseas for at least 183 days, you generally notify the Tax Office within seven days after leaving. You subsequently report worldwide income or lodge the applicable non-lodgment advice, generally by 31 October when lodging personally. Once your income passes the threshold, a compulsory repayment or overseas levy may apply.
Pre-departure planning is among the highest-value tax work an expatriate can undertake because more planning options are usually available before tax residency changes. An appointment is for you if you are moving overseas, whether that is next month or next year. We work out whether and when your residency will cease, model the departure capital gains tax position and the choice available to you, advise on the timing of any property sale, sort out your rental and investment income reporting, deal with your study loan and super questions, and prepare a departure-year return that closes the chapter properly. We work remotely with Australians all over the world, and we provide an upfront quote before commencing work.
Book a pre-departure consultationGeneral information only. This article is current as at 1 August 2026 and doesn't consider your personal circumstances. It isn't tax, financial or legal advice. Your tax residency, the timing of your departure, and the treatment of your income, investments, property and superannuation all depend on your specific circumstances and can change over time. Speak to our specialist expatriate tax team today, or to another registered tax agent, before acting.
