Technical Update –Overseas Move and Implications

Advice given to the clients prior to an overseas move should address the following:

  • Tax implications – A permanent overseas move may result in the client becoming a non tax resident.  The implications of becoming a non tax resident are discussed below.
  • Social security entitlement – how will social security entitlement be impacted? Does the new country of residency have an international social security agreement with Australia? The importance of notifying Centrelink of the overseas move.
  • Estate planning – importance of obtaining estate planning advice and whether Wills are required in each jurisdiction.
  • Review of Self Managed Fund (SMSF) – is the SMSF the best superannuation vehicle? Steps to maintain the SMSF Australian residency? Review of any contribution strategies.
  • Cashflow and budgeting –funding of capital expenses on the overseas move, review of cashflow and pension payment in view of potential social security decrease and new living expenses and managing exchange rate risk.
  • Insurances – review of insurance to ensure that current providers will honour claims while overseas. Implication of cancelling private health cover.


Below are some implications when a client becomes a non-tax resident:

  • Family home will not be considered as an exempt asset for Centrelink purposes.
  • Future sale of the family home will not be exempted from CGT.
  • Any property sale will not attract 50% CGT exemption on the increased value post May 2012.
  • Crystallization of capital gains on non-property CGT assets on departure from Australia
  • Withholding tax on interest bearing accounts
  • Higher tax rates


Further information is available on the ATO website by clicking here.