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Australia Leaving Australia Tax Guide

Australian tax obligations on leaving Australia permanently. The guide covers: the CGT exit rules for the individuals who cease being the Australian residents — the 'deemed disposal' and the 'CGT exit' under the 'CGT event A1' or the 'CGT event I1' for the individuals who stop being the Australian residents (the 'tax residents of Australia'); the individuals who depart Australia are deemed to have disposed of their 'CGT assets' (except the 'Australian real property' and the 'taxable Australian property') at the 'market value' immediately before the 'residency stops' (the 'deemed disposal' under the 'Section 104-160 of the ITAA 1997'); the departing residents may elect to use the 'fixed trust method' or the 'actual disposal method' for the CGT exit; the departing Australia superannuation payment (the 'DASP') for the 'temporary residents' — the temporary residents who leave Australia permanently can claim the 'DASP' (the 'departing Australia superannuation payment') from their 'superannuation fund'; the DASP is taxed at the rate of 35% for the 'taxable component' (the 'taxable component — the 'element taxed' in the fund) and 45% for the 'untaxed element' (the 'element untaxed'); the 'tax-free component' is paid tax-free; the DASP must be claimed within 6 months of departure (or 12 months for the 'departing residents' who hold the 'working holiday maker visa'); the tax clearance for the departing residents — the 'ATO tax clearance' may be required for the individuals with the 'outstanding tax liabilities'; the departing residents should update the 'address' with the ATO and the 'myGov' account; the departing residents should also cancel the 'ABN' (if applicable) and the 'GST registration'.

CGT Exit on Departure

  • Deemed disposal: The individuals who cease being the Australian residents are deemed to have disposed of their 'CGT assets' (except the 'taxable Australian property' and the 'Australian real property') at the 'market value' immediately before the 'residency stops'. The 'deemed disposal' triggers the 'CGT event I1' — the capital gain or the 'capital loss' is calculated as the 'market value' minus the 'cost base'.
  • Assets excluded: The 'taxable Australian property' (including the 'Australian real property', the 'Australian property used in the business', and the 'shares in the Australian private companies') is NOT subject to the 'deemed disposal' — these assets remain in the CGT system and are taxed on the 'actual disposal'.
  • Election to disregard: The departing residents may elect to 'disregard' the deemed disposal (the 'CGT exit election') — the assets are held on the 'CGT basis' until the 'actual disposal' (the 'actual disposal' triggers the CGT even if the individual is the 'non-resident' at the time of the disposal).

For the CGT discount and the 50% reduction, see our Capital Gains Tax Guide →.

Departing Australia Superannuation Payment (DASP)

  • Temporary residents: The 'temporary residents' who leave Australia permanently can claim the 'DASP' from their 'superannuation fund'. The DASP is available to the 'temporary residents' who hold the 'eligible visa' (the 'student visa', the 'working holiday visa', the 'skilled work visa', etc.).
  • Tax rates: The 'taxable component — the 'element taxed' in the fund is taxed at 35%. The 'taxable component — the 'element untaxed' is taxed at 45%. The 'tax-free component' is paid tax-free. The DASP must be claimed within 6 months of departure (or 12 months for the 'working holiday maker visa').
  • Application: The DASP is claimed through the 'ATO online' service (the 'DASP application' through the 'myGov' or the 'ATO online portal'). The 'superannuation fund' pays the DASP to the applicant (or to the 'commissioner' if the fund cannot locate the member).

For the superannuation contributions and the concessional caps, see our Superannuation Guide →.

Tax Clearance & Other Obligations

  • ATO tax clearance: The departing residents should ensure that the 'tax clearance' is obtained from the ATO (the 'tax clearance certificate' confirms that the individual has no 'outstanding tax liabilities' and the 'tax returns' are lodged).
  • Address update: The departing residents should update their 'address' with the ATO (the 'mailing address' for the 'tax returns', the 'tax assessments', and the 'ATO correspondence').
  • ABN & GST cancellation: The departing residents who hold the 'ABN' (the 'Australian Business Number') should cancel the 'ABN' and the 'GST registration' (if applicable) before departure or within 21 days of ceasing the 'business activity'.

For the ABN cancellation and the business closure procedures, see our Closing a Business Guide →.