Australia sits 178th out of 217 in our world ranking, with a FiScore of 3.9 out of 10. The top marginal rate is 45%, corporate tax is 30%, and GST is 10%.
Leaving is where it gets interesting, because Australia gives you a choice that no other country on this site offers, and choosing wrong is expensive.
CGT event I1
Under section 104-160 of the Income Tax Assessment Act 1997, ceasing to be an Australian tax resident triggers CGT event I1: you are treated as having disposed of your assets at market value on the day your residency ends.
The event does not touch taxable Australian property, essentially Australian real estate and interests in land-rich entities, which stays inside the Australian net whatever you do.
Everything else, foreign and Australian shares, managed funds, crypto, is caught.
The choice nobody explains properly
Here is what makes Australia different. You can elect to disregard the deemed disposal.
Make that election and the assets are instead treated as having become taxable Australian property. No tax on departure. Australia keeps taxing them, and when you eventually sell, wherever you are living, the Australian bill arrives.
So the choice is:
| Trigger now | Defer by election | |
|---|---|---|
| Tax on departure | yes, on unrealised gains | none |
| Later sale as a non-resident | outside Australian CGT | fully inside it |
| 50% discount | applies to the whole holding period | lost for the non-resident years |
That last line is the one that decides most cases, and it is routinely left out.
Why deferring can cost more than paying
The 50% CGT discount for assets held over twelve months is only available for periods of Australian residence.
If you defer, you keep the asset for another eight years abroad and then sell, the gain accrued during those eight non-resident years gets no discount at all. You have not postponed a bill, you have changed what you will be taxed on.
Triggering the event on the way out, by contrast, crystallises a gain that is fully discountable, and then removes the asset from Australia's reach for good.
Rough rule of thumb, and it is only that:
- Sitting on large unrealised gains and leaving for good: triggering often wins, because you buy the discount and a clean break.
- Modest gains, or losses, or you expect to return: deferring often wins, because there is little to crystallise and the discount you forgo is small.
- You are moving to a country with low or no CGT: think hard. Deferring keeps the gain permanently inside Australia's system and hands your new country's zero rate to nobody.
That last point is the one people get backwards. Moving to Dubai or Singapore does not help if you elected to leave your portfolio inside the Australian net.
Superannuation
Super is not caught by CGT event I1 and it does not come with you. Leaving Australia does not let you access it early, except for temporary residents under a specific departing-superannuation payment, which is taxed heavily on withdrawal.
For permanent residents and citizens, super stays where it is until a condition of release is met. Plan around it rather than for it.
Residency is not a checkbox
None of the above matters until you have actually ceased Australian residency, and the tests are behavioural rather than mechanical. The ATO looks at where you live, your family, your assets and your intentions, not just at a day count.
Leaving with a lease still running, a family still in Melbourne and a return ticket is not ceasing residency, whatever your calendar says.
Australia against the others
Four countries, four logics.
Australia deems a disposal but lets you elect out, at the cost of the discount.
Canada deems a disposal with a deferral election that keeps the tax due but delays payment, plus a 60-month exemption for recent arrivals.
Germany taxes shareholdings and, since 2025, large fund holdings, with seven interest-free instalments.
The United Kingdom taxes nothing on departure but reaches back if you return within five years.
The order of operations
- Establish the actual date residency ceases, with evidence.
- List what is and is not taxable Australian property.
- Value everything at that date.
- Model both paths, trigger and defer, over your realistic holding period, with and without the discount.
- Then decide, and make the election in the return for the year of departure if you are deferring.
Sources
Rules verified in August 2026 against section 104-160 of the ITAA 1997 and Australian Taxation Office guidance on how changing residency affects CGT. An error reported to us gets fixed.
This page informs, it does not advise. The trigger-or-defer decision turns on numbers specific to you: model it with an Australian adviser before you go, as our terms of use set out.