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Budget CGT change could be extremely expensive for expat and offshore investors

October 1st, 2012

The Government has announced changes to the tax rates and thresholds that will result in non-resident individuals who derive Australian source income paying higher average rates of income tax. In addition, non-residents will henceforth be denied access to the capital gains tax (CGT) discount (with some transitional relief for assets currently held). Furthermore, the current 7.5 per cent withholding tax rate applicable to payments by managed investment trusts (MITs) to residents of countries with effective exchange of information arrangements with Australia will be increased to 15 per cent.