If you own a secondary or investment property in Australia, it is likely to be subject to capital gains tax (CGT) in Australia when sold.
The Australian government is proposing to remove one of the CGT concessions from non-residents (including New Zealanders), with effect from 8 May 2012. At the time of writing the legislation is yet to be passed, although our understanding is that its passing is a formality.
The concession in question (a 50% discount on CGT) is available to all individuals and trusts (including non-residents), provided the property has been held for at least 12 months. If you owned such a property prior to 8 May 2012, a partial discount on eventual sale is still available provided you have a valuation of the property as at 8 May 2012.
This partial discount will be 50% of the CGT calculated on the notional gain made to 8 May 2012, provided you have held the property for at least 12 months before it is actually sold.
Contact us if you would like help in understanding the CGT concession or if you would like further information about Australian Property Investment regulations. For any particularly complex matters, it’s reassuring to note that our colleagues at UHY Haines Norton Australia are on-hand to assist.