QLD Land Taxes plus Non-Resident CGT Primary Residence exemption removal - triple hit to expats

The compounded negative tax consequences of being an expat non-resident who owns a property in Queensland makes it an even worse idea to hold a property in that State.

What it means for expats who become non-residents is not only in QLD will you be subjected to Land Tax & Absentee Surcharges yearly, but come time to sell you will also lose a substantial portion of any Capital Gains made at the Foreign Resident rate. A 'combo' of State and Federal Taxes to wipe your profits out.

This Australian Financial Review article dated 20 April 2018 is titled, "Aussie expats go into battle over capital gains tax crackdown". The removal of the Capital Gains Tax exemption for non-residents owning Primary Residences (also known as the nominated Principal Place of Residence or PPOR) is coming into effect 30 June 2019.

Liberal MP Scott Morrison (now Prime Minister) was Treasurer at the time and was instrumental in the implementation of the tax ruling. As outlined in the article, expats have once again been penalised for being overseas. The Australian Chamber of Commerce is against the changes.

The article states, "The Coalition argues its measures are a "scalpel" compared to Labor's "sledgehammer" of removing negative gearing and reducing the capital gains tax discount for all Australians."

Whilst the coalitions statement is likely true (Labor already has proposed this), it still does not remove the fact that they implemented the CGT changes in the first place.

The combined effect is stifling to Queensland property owners who - to avoid the Land tax and Absentee Surcharge - not only cannot stay/travel overseas for more than 6 months of a year, but also have to be extremely careful they don't inadvertently become non-residents by failing a domicile/183 day absent test and need to sell their property. It does not matter that you may have lived in and owned the property for several years. Just one non-resident event is all it takes.

What is astounding and disgraceful, is that both the QLD State and Federal governments have failed to care how devastating these laws are on their own. But even worse that they have not likely considered or cared to take into account that when compounded together they are a 'tax tsunami'.  😠

it is ironic that Malcolm Turnbull - ousted ex-Prime Minister, is holidaying in New York and staying in his multi million dollar apartment there, which I dare say does not attract absentee surcharges or severe CGT taxes for being a non-resident.

Article link:

aussie-expats-go-into-battle-over-capital-gains-tax-crackdown