how to leave australia

Guide

Coming back

Returning to Australia is a tax event as real as leaving was, and it hands you a rare gift if you get the timing right. The day you resume residency, most of your foreign investments are treated as freshly bought at today’s value, and the gains you made while away can drop out of the Australian net entirely. But only if you act before the plane lands. Here is the sequence.

The cost-base reset on resuming residency

When you become an Australian tax resident again, the law deems you to have reacquired your non-TAP assets at their market value on the day residency resumes. Non-TAP is the same broad category as on the way out, listed shares, ETFs, managed funds, crypto, foreign real estate, most private-company equity below the land-rich threshold. Their cost base resets to the market value on your return date.

The consequence is the valuable part: gains that accrued while you were a non-resident escape Australian CGT, if you realise them before the residency-restart date. Australia never taxed those assets while you were away (they were non-TAP, held by a non-resident), and the reset means it only starts counting from your return. Sell an appreciated foreign holding the week before you resume residency and the whole offshore gain is outside Australian CGT. Sell it the week after, and Australia taxes the gain measured from the reset value, but any growth before the reset is already baked out. Either way, the pre-return appreciation is the piece that can walk free, and the return date is the line that decides it.

The deferred-election exception

There is one important carve-out. If, when you left, you made the deferral election under CGT event I1, choosing not to pay the exit tax and instead treating your non-TAP assets as taxable Australian property while abroad. Those assets do not get the clean cost-base reset on return. They were kept in the Australian net the whole time by your own election, so there is nothing to reset; Australia has been entitled to tax their full gain all along. Deferred-election assets are the exception to the escape, and if you have them, the pre-return-sale trick does not apply to them. This is one more reason the departure-day deferral decision echoes for years.

The return date as a planning event

Because the reset happens on a single date, that date is a lever. Everything you want to realise gain-free needs to happen on the non-resident side of it. That means the return should be planned, not drifted into: identify which foreign holdings carry large accrued gains, decide what to sell before you resume residency, and only then book the move. Treat “when do I become a resident again” as a decision with a dollar value, not an administrative afterthought. The ATO will fight you on when residency actually resumed, so the date needs to be supportable by real facts (lease, job start, family arriving), not just a convenient claim.

Part-year residency in the return year

You will almost certainly be a part-year resident in the year you come back, a non-resident up to your return date, a resident from it. That splits your tax year in two. Income and gains before the return date are taxed on the non-resident basis (Australian-source and TAP only); income and gains from the return date are taxed on the resident basis (worldwide). Your tax-free threshold is pro-rated for the resident part of the year, so it is smaller than a full year’s $18,200. Practically, this is why realising foreign gains before the return date is doubly useful: those gains fall in the non-resident portion, outside worldwide taxation, and the reset means the resident portion starts from a stepped-up base.

Lifetime Health Cover loading

A non-tax cost that catches returnees: Lifetime Health Cover (LHC) loading. If you don’t hold private hospital cover after the 1 July following your 31st birthday, a 2% loading is added for each year you go without, up to a cap. There is relief for time spent overseas, but only up to a point. Broadly, you can be away for more than 1,094 days (roughly three years) before overseas time starts counting against you, and once you return you generally have a limited window to take out cover before the loading applies. Stay away longer than that window allows without cover, and you can come home to a permanent loading on your premiums. It is small next to the CGT numbers, but it is easy to trip and hard to undo.

The re-entry sequence

Putting it in order, the clean return looks like this:

  1. Before you resume residency: identify foreign holdings with large accrued gains, and realise the ones you want to keep out of the Australian net. This is the window that closes on your return date.
  2. Check your deferred-election assets: if you deferred on the way out, those don’t reset, so treat them separately.
  3. Fix the return date deliberately: line up the lease, the job start and the family’s arrival so the date you claim is the date your facts support.
  4. Plan the part-year return: expect a pro-rated threshold and a split-basis year, and time other income accordingly.
  5. Re-start the practicalities: reinstate Medicare, take out private hospital cover inside the LHC window, and update your residency status with banks, brokers and the ATO.

General information only, not tax, legal or financial advice, and no tax agent services are provided. Verify your position with a registered tax agent before acting. Rates and rules last verified: 23 July 2026.