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Property CGT

UK-Australia Property Capital Gains Tax Expat Guide 2026

Practical 2026 guide to UK and Australian property CGT for cross-border owners, covering HMRC 60-day reporting, Private Residence Relief, Australian foreign-resident CGT, Foreign Resident Capital Gains Withholding, main-residence rules, currency conversion and treaty relief.

Overview of UK-Australia Cross-Border Property CGT

A person who is resident in one country while owning property in the other can potentially have tax obligations in both countries. The correct result depends on the owner's tax residence, the location and nature of the property, the dates of acquisition and disposal, the period the property was occupied as a home, the use of the property for letting or business, and the relevant domestic and treaty rules. The UK and Australia do not use identical CGT systems, so a gain must normally be calculated separately under each country's rules rather than simply converted once and taxed twice on the same calculation.

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UK residential property disposals can trigger a UK Capital Gains Tax on UK Property reporting and payment obligation within 60 days of completion for the specified disposals.
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A non-UK resident disposing of UK property or land generally has a UK reporting obligation even where no UK CGT is ultimately payable.
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For Australian taxable Australian property, Australian CGT can apply to a foreign resident, but the Australian rules depend on whether the asset is taxable Australian property and on the seller's circumstances.
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From 1 January 2025, the Australian Foreign Resident Capital Gains Withholding regime generally uses a 15% rate and the previous $750,000 threshold no longer applies.
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Australian withholding is an amount withheld from the transaction and paid to the ATO; it is not itself necessarily the seller's final CGT liability.
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Australia's main residence exemption has special restrictions for foreign residents at the time of the CGT event, subject to statutory exceptions.
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UK Private Residence Relief can continue to apply to qualifying periods of occupation and certain final-period or absence provisions, but non-resident owners must satisfy the particular UK rules.
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Article 13 of the UK-Australia Convention allocates treaty taxing rights over property gains but does not by itself mean that all foreign tax automatically becomes a pound-for-pound UK credit.

Comparative 2026 Framework: UK HMRC vs Australia ATO

The two countries operate materially different CGT systems. The UK generally taxes chargeable gains under a separate CGT framework, while Australian individuals generally include a net capital gain in assessable income and apply the relevant individual tax rates. The Australian CGT discount is a calculation concession rather than a separate tax rate, and foreign-resident rules can reduce or deny the amount of discount available for relevant periods.

CGT FeatureUK HMRC RulesAustralia ATO Rules
Individual CGT RatesFor 2026-27, the standard individual CGT rates for most gains are 18% and 24%, subject to the type of gain and the taxpayer's circumstances.Net capital gains are generally included in assessable income and taxed at applicable individual income-tax rates; the 50% CGT discount may apply where statutory conditions are met.
Annual Exempt Amount / DiscountThe individual annual exempt amount is £3,000 for 2026-27.Individuals may generally receive a 50% CGT discount for eligible assets held for at least 12 months, but foreign-residency rules can reduce the discount for relevant gains.
UK Property ReportingMost UK residential property disposals requiring CGT must be reported and tax paid within 60 days of completion. Non-residents have broader UK property/land reporting requirements.Australia generally deals with the final CGT liability through the relevant income-tax return, while FRCGW can require an amount to be withheld during settlement.
Foreign Resident Property WithholdingThere is no equivalent Australian-style FRCGW withholding regime imposed by the UK on ordinary residential property sales.From 1 January 2025 the FRCGW rate is generally 15% and the previous $750,000 threshold was removed. Clearance certificates and variation processes can affect withholding.
Main ResidencePrivate Residence Relief can exempt or reduce a qualifying gain where the dwelling was the individual's only or main residence and the detailed occupation and absence rules are satisfied.The main residence exemption is restricted where an individual is a foreign resident when the CGT event happens, subject to specific statutory life-event exceptions.

Selling UK Property While Living in Australia

A person who is non-UK resident and disposes of UK property or land can fall within the UK's non-resident Capital Gains Tax rules. For a direct or relevant indirect disposal of UK property or land, the UK reporting rules can apply even where the eventual tax liability is nil. For UK residential property disposals requiring a Capital Gains Tax on UK Property return, the report and any CGT due are generally required within 60 days of completion. The seller may subsequently need to include the non-resident gain in Self Assessment where applicable.

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The 60-day deadline is tied to the specified property reporting regime and completion; it should not be confused with the legal CGT disposal date.
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For UK CGT purposes, the disposal date under an unconditional contract is generally the contract date rather than completion, subject to statutory exceptions.
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A non-resident generally reports a disposal of UK property or land even when there is no tax to pay.
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For residential property acquired before the relevant non-resident CGT commencement dates, special rebasing and time-apportionment rules can be relevant.
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For a UK home, Private Residence Relief can reduce the gain if the property was genuinely an only or main residence and the statutory occupation, nomination, absence and final-period rules are satisfied.
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For 2026 guidance, the final nine months generally qualify for Private Residence Relief where the property has qualified as the individual's only or main residence at some point, subject to the detailed legislation.
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A non-resident may also need to consider the 90-day day-count test and other conditions when determining whether a property qualifies as the only or main residence for particular tax years.

UK Private Residence Relief for an Expat Living in Australia

Moving to Australia does not automatically remove all UK Private Residence Relief. The relief is calculated by reference to qualifying periods and the statutory rules applying to the dwelling. A former UK home may receive relief for periods when it genuinely qualified as the individual's only or main residence, certain qualifying periods of absence, and the final qualifying period. However, a non-UK resident cannot simply claim the entire ownership period as exempt because the property was once their home.

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The final nine months of ownership generally qualify for relief if the dwelling has been the individual's only or main residence at some point, subject to the special rules for disabled persons and certain care-home cases.
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For relevant non-resident cases, the 90-day test can determine whether a dwelling is regarded as the only or main residence for a tax year.
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Where spouses or civil partners have relevant residences, the nomination and 90-day rules can require particular attention.
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Periods of absence may qualify for relief only where the statutory absence conditions are met.
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Letting part or all of the property, using part for a business, or having multiple residences can affect the amount of Private Residence Relief.
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Private Residence Relief generally exempts qualifying portions of the gain rather than automatically converting every gain on a former home into a zero-tax disposal.

Selling Australian Property While Living in the UK

A UK resident who disposes of Australian real property can generally be within Australia's taxing jurisdiction because Article 13 of the UK-Australia Convention permits Australia to tax gains from real property situated in Australia. Australia also applies its domestic CGT rules to taxable Australian property. The UK may also tax a UK-resident individual under UK domestic law, meaning the same economic gain can require separate Australian and UK calculations and then a double-tax-relief analysis.

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Article 13 does not mean that Australian CGT is necessarily the only tax that can arise.
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The Australian gain must be calculated under Australian CGT rules rather than by taking a UK sterling gain and simply applying an Australian rate.
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A UK resident may have a separate UK gain calculated under UK CGT principles using sterling translations at the relevant transaction dates.
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Australian CGT withholding at settlement is separate from the final Australian tax calculation and does not automatically equal the final CGT liability.
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Where both countries tax the same gain, the UK-Australia Convention and UK foreign-tax-credit rules may provide relief, subject to the applicable limits and conditions.

Australian Main Residence Exemption for Foreign Residents

Australia's main residence exemption contains special rules for individuals who are foreign residents when a CGT event happens to Australian residential property. Since the 2019 law changes, a foreign resident is generally unable to claim the main residence exemption on the disposal of an Australian dwelling unless a statutory exception applies. A narrow life-event exception can preserve eligibility in qualifying circumstances, including specified events occurring within the relevant period of foreign residency.

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The relevant question is the taxpayer's Australian tax residency status when the CGT event occurs, not simply whether the person previously lived in Australia.
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Being a former Australian resident does not automatically preserve the main residence exemption after becoming a foreign resident.
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Certain life events can allow an exemption or partial exemption under specific statutory conditions.
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The Australian rules should not be simplified to 'non-residents never get the exemption'; the statutory exceptions matter.
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The Australian main residence exemption is separate from UK Private Residence Relief. A property can therefore receive different relief outcomes in the two tax systems.

Australian 50% CGT Discount for Former Residents

The original 50% discount statement was too broad. Australian individuals can generally qualify for a 50% CGT discount where an eligible asset has been held for at least 12 months, but special rules apply to foreign and temporary residents and to Australian residents who have periods of foreign residency. For relevant taxable Australian property and gains accruing after 8 May 2012, the law can deny or reduce the discount for the portion of the gain accruing while the individual is a foreign or temporary resident, subject to the statutory rules and transitional exceptions.

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The Australian CGT discount is not simply 'available only to Australian residents'.
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Foreign residency can reduce the amount of the discount for relevant gains accruing after 8 May 2012.
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The precise calculation can require apportionment of the gain between periods of Australian residency and foreign residency.
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Special rules can preserve limited discount treatment for certain assets and historical circumstances.
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The asset's acquisition date, CGT event date, residency periods and whether the asset is taxable Australian property can therefore materially change the result.

Australian Foreign Resident Capital Gains Withholding (FRCGW)

The Australian Foreign Resident Capital Gains Withholding regime is a settlement withholding mechanism. The current regime changed materially from 1 January 2025: the withholding rate increased from 12.5% to 15% and the previous $750,000 property-value threshold was removed. The purchaser generally has an obligation to withhold an amount from the consideration and remit it to the ATO when the relevant rules apply. The withheld amount is credited to the seller and is not automatically the seller's final Australian CGT bill.

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From 1 January 2025 the standard FRCGW rate is 15%.
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The previous $750,000 threshold no longer applies to contracts covered by the current regime.
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The rules can apply to both residential and commercial Australian real property and certain indirect Australian real-property interests.
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An Australian resident vendor can generally prevent withholding by obtaining the required clearance certificate and providing it to the purchaser.
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A foreign resident vendor may in appropriate circumstances obtain a variation so that the withholding amount better reflects the expected tax position.
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The withholding is credited against the seller's tax liability through the Australian tax return and is not the same thing as calculating the final capital gain.

Currency Conversion: Do Not Simply Convert the Final Foreign Gain

For a UK resident calculating UK CGT on Australian property, foreign-currency amounts generally need to be translated into sterling at the relevant dates rather than calculating the entire Australian-dollar gain first and converting that single gain at the disposal-date exchange rate. Acquisition cost is generally translated using the exchange rate appropriate to acquisition, disposal proceeds using the disposal-date rate, and relevant expenditure using the appropriate transaction date. The Australian calculation is separately performed under Australian rules and ordinarily uses Australian dollars.

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The original statement that the completion-date exchange rate determines the whole gain was too broad.
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For UK CGT, currency amounts are generally translated at the dates the relevant expenditure or proceeds arise.
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The UK CGT disposal date is generally the contract date for an unconditional contract, not automatically the completion date.
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For UK property reporting, completion is nevertheless crucial because the 60-day reporting/payment deadline is measured from completion for the relevant property regime.
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The two dates therefore serve different purposes: the disposal date can determine the CGT tax year, while completion determines the 60-day property reporting deadline.
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A reasonable and consistent exchange-rate source should be retained with the calculation records.

UK-Australia Treaty Relief and Double Taxation

Article 13 of the UK-Australia Double Taxation Convention permits the state in which real property is situated to tax gains from its disposal. The treaty does not itself say that tax paid in the property country is always refunded or credited in full by the residence country. The residence country's domestic foreign-tax-credit rules and Article 22 must be applied to determine the amount of relief. In the UK, credit is generally limited by the foreign tax credit rules and by the UK tax attributable to the same doubly taxed income or gain.

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Australian CGT on an Australian property can be treaty-permitted under Article 13.
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UK taxation can also remain relevant for a UK resident under UK domestic law.
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Foreign Tax Credit Relief is not automatically equal to the full foreign tax paid.
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The credit normally relates to the same income or gain and is subject to the relevant admissibility and limitation rules.
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Relief cannot safely be calculated by simply subtracting the Australian tax bill from the UK tax bill without first matching the relevant gain and tax amounts.
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The treaty should be read together with each country's domestic tax rules and the current synthesised treaty/MLI position.

Practical 2026 Cross-Border Property CGT Workflow

A robust calculation should be performed separately for each country before the double-tax position is reconciled. First establish tax residence in each country for the relevant year. Next identify the exact asset and disposal. Then calculate the gain under Australian law and separately under UK law. Apply the relevant main-residence or other reliefs in each jurisdiction, determine the applicable tax, account for Australian FRCGW if any amount was withheld, and only then calculate available UK foreign tax credit relief.

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Step 1: establish UK and Australian tax residence for the disposal year.
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Step 2: identify the property type, ownership percentage, acquisition date and disposal date.
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Step 3: calculate the Australian CGT position, including taxable Australian property, discount, main-residence rules and any FRCGW withholding.
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Step 4: calculate the UK CGT position, including UK property rules, PRR, allowable costs, the annual exempt amount and the applicable rate.
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Step 5: translate currencies correctly for the UK calculation using the appropriate transaction dates.
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Step 6: determine treaty taxing rights under Article 13.
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Step 7: calculate available foreign tax credit relief under Article 22 and UK domestic rules.
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Step 8: reconcile the tax already withheld in Australia with the final Australian liability and preserve documentary evidence for both returns.

Frequently Asked Questions (6)

For a relevant disposal of UK residential property, the CGT on UK Property return and any CGT due generally have to be reported and paid within 60 days of completion. Non-UK residents also have broader reporting obligations for UK property or land, even where no tax is ultimately payable. The 60-day deadline is measured from completion for the property reporting regime; the CGT disposal date for the tax year is generally determined separately under the contract rules.

No. The original blanket statement is too broad. Individuals can generally qualify for the Australian 50% CGT discount where the asset has been held for at least 12 months, but special foreign-resident rules apply to relevant gains accruing after 8 May 2012. Those rules can reduce or deny the discount for the portion of the gain accruing during foreign-residency periods, subject to statutory exceptions and historical circumstances. The acquisition date, CGT event date, residency periods and type of taxable Australian property therefore matter.

From 1 January 2025, the FRCGW rate is generally 15% and the previous $750,000 threshold was removed. Where the withholding rules apply, the purchaser generally withholds the required amount from the transaction and pays it to the ATO. Australian-resident vendors can generally avoid withholding by providing the required clearance certificate, while eligible foreign-resident vendors can in appropriate cases seek a variation. The amount withheld is a credit against the seller's Australian tax position and is not automatically the final CGT liability.

Potentially, but not automatically for the whole ownership period. A former UK home can qualify for Private Residence Relief for periods when it was genuinely the individual's only or main residence and for certain statutory absence and final-period rules. For qualifying disposals, the final nine months generally qualify where the dwelling has been the individual's only or main residence at some point. Non-resident cases can also require the 90-day test and, where relevant, residence nomination rules. The Australian main residence exemption is a separate regime and does not determine UK PRR.

You should not normally calculate one Australian-dollar gain and convert that entire gain to sterling at the completion-date exchange rate. For UK CGT, foreign-currency acquisition costs, disposal proceeds and relevant expenditure are generally translated into sterling using the appropriate exchange rate at the date of the acquisition, disposal or expenditure. The UK disposal date is generally the date of the relevant contract rather than automatically the completion date. Completion still matters because the 60-day UK property reporting deadline is based on completion.

Potentially both countries can tax the same economic gain, because Article 13 of the UK-Australia Convention allows Australia to tax gains from Australian real property while UK domestic law can also tax a UK resident. This does not mean the same tax must be paid twice without relief. Article 22 and UK foreign-tax-credit rules can provide credit for qualifying Australian tax, but the credit is subject to admissibility and limitation rules and is generally capped by the UK tax attributable to the same doubly taxed gain.
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2026 TAX SNAPSHOT

Standard Personal Allowance
£12,570
Standard allowance; specialist and Scottish rules can differ.
England / Wales / Northern Ireland Basic-Rate Band
£37,700
£50,270 including the standard £12,570 Personal Allowance.
4-Year FIG Regime
Maximum 4 tax years
Available to qualifying new UK residents after at least 10 years of non-UK residence.
IHT Long-Term UK Residence
10 of previous 20 years
Overseas-asset exposure can continue for 3–10 years after leaving, depending on residence history.

Summary Takeaways & Checklist

  • Relevant UK residential property disposals generally require a Capital Gains Tax on UK Property return and payment within 60 days of completion.
  • A non-UK resident generally has to report disposals of UK property or land even where no UK CGT is ultimately payable.
  • From 1 January 2025, Australia's FRCGW rate is generally 15% and the previous $750,000 threshold was removed.
  • FRCGW is a settlement withholding mechanism and is credited against the seller's Australian tax position; it is not automatically the seller's final CGT liability.
  • Australian foreign-resident rules can restrict the main residence exemption and the 50% CGT discount, but neither rule should be described as an absolute blanket denial without considering the statutory exceptions and gain-accrual rules.
  • UK Private Residence Relief can continue to cover qualifying occupation and certain final or absence periods, but a former home owned while living abroad is not automatically fully exempt.
  • UK CGT calculations involving Australian-dollar amounts generally require transaction-date currency conversions rather than converting the whole foreign-currency gain at the completion-date exchange rate.
  • The UK-Australia treaty can permit Australia to tax Australian real-property gains while also allowing UK taxation where UK domestic law applies; available foreign tax credit relief then depends on Article 22 and UK credit-limit rules.

Official References & Manuals

GOV.UK Capital Gains Tax for Non-Residents: UK Property and LandGOV.UK Capital Gains Tax: Reporting and PayingGOV.UK Private Residence Relief HS283 2026ATO Foreign Resident Capital Gains WithholdingATO Foreign Residents and CGTGOV.UK 2003 Australia-UK Double Taxation Convention

Related HMRC Guides

UK-Australia Double Taxation Treaty GuideHMRC UK Capital Gains Tax Property Rates CalculatorUK Expat Self-Assessment SA100 Guide