You moved to Australia years ago and kept the apartment back home. This year you sold it. The buyer paid in renminbi, the money is still in a bank account overseas, and the sale price was roughly what the place was worth when you left. It is tempting to conclude there is nothing to report.
If you were an Australian resident for tax purposes when you signed the contract, the sale belongs in your Australian tax return, and the gain is worked out in Australian dollars. A flat price in renminbi can still produce an Australian capital gain, or a loss, depending on what the exchange rate did while you owned it.
The short answer
Australian residents for tax purposes are taxed on capital gains from assets anywhere in the world. The ATO’s guidance is that capital gains on overseas assets are treated the same way as capital gains on Australian property, and that foreign tax paid on a gain that is taxable here may give you a foreign income tax offset. The capital gain or loss is made when you sign the contract, not at settlement, so a contract signed between 1 July 2025 and 30 June 2026 goes in your 2025-26 return. If you became a resident after you bought the property, your cost for Australian purposes is usually the property’s market value on the day you became a resident, not the price on your original purchase contract. Every amount is converted to Australian dollars at the exchange rate on the day it happened. Temporary residents are generally outside this, because they pay CGT only on taxable Australian property.
Does it apply to you?
It depends on your residency status at the time the contract was signed.
| Your status when you signed the sale contract | Australian CGT on the overseas property |
|---|---|
| Australian resident for tax purposes, not a temporary resident (most citizens and permanent residents living here) | Yes. The gain or loss is reported in your Australian return |
| Temporary resident (temporary visa, and neither you nor your spouse is an Australian citizen or permanent resident) | Generally no. Temporary residents are taxed like foreign residents on capital gains, which means only on taxable Australian property such as Australian real estate |
| Foreign resident for tax purposes | No. Only taxable Australian property is subject to Australian CGT |
Source: ATO, Your residency status and CGT (QC 69714) and How changing residency affects CGT (QC 66059), both last updated 22 June 2026.
Tax residency is its own test. It is not the same as citizenship or visa status, and people who work overseas can remain Australian residents for tax purposes. If your status during the year is unclear, our article on tax residency when you work overseas sets out the four tests and how the Federal Court applied them in September 2026. If you were a temporary resident when you arrived and later became a permanent resident, check the starting value with your accountant before you sell, because your status changed partway through your ownership.
Your cost is usually not what you paid
This is where most self-prepared calculations go wrong. When you become an Australian resident for tax purposes, and are not also a temporary resident, the law treats you as having acquired your CGT assets on that day at their market value. The ATO calls this deemed acquisition. It does not apply to assets acquired before CGT started on 20 September 1985, or to taxable Australian property such as Australian real estate.
For an apartment in Shanghai bought in 2010 by someone who became an Australian resident in July 2023, the cost base for Australian purposes starts from the apartment’s market value in July 2023. The 2010 purchase contract does not set the Australian cost. Growth before you became a resident is outside Australian tax, and growth after it is inside. The same date generally starts the 12-month clock for the 50% CGT discount on an asset you are treated as acquiring that day.
The practical consequence is a record you may not have: evidence of the market value on the day you became a resident. A contemporaneous valuation is best. If none was done, a retrospective valuation from a qualified valuer, or a documented comparison with sales of similar properties around that date, is the usual way to support the figure.
Every amount is converted on its own date
Under the general translation rule, foreign currency amounts that matter for tax are converted to Australian dollars. For a capital asset, the ATO says to translate each amount at the exchange rate that applied at the time of the relevant transaction or event (QC 17061). For a sale, the event is the contract date (QC 66016). That means the cost, the costs of buying and selling, and the sale price are each converted on their own dates, and the gain is the difference in Australian dollars.
Here is what that does to a sale where the price in renminbi did not move. The property values below are illustrative, not a client’s figures. The exchange rates are the Reserve Bank of Australia’s published AUD/CNY rates for those days.
| Price in CNY | RBA rate (CNY per A$1) | In Australian dollars | |
|---|---|---|---|
| Market value on becoming a resident, 3 July 2023 | 3,000,000 | 4.8307 | A$621,028 |
| Scenario A: contract signed 31 July 2025 at the same price | 3,000,000 | 4.6532 | A$644,718 |
| Scenario B: contract signed 30 January 2026, price down 5% | 2,850,000 | 4.8673 | A$585,540 |
In Scenario A the owner sold for exactly what the property was worth in renminbi and still made a capital gain of about A$23,690 before costs, because the Australian dollar bought fewer renminbi on the sale date. In Scenario B the price fell 5% and the result is a capital loss of about A$35,488, which can only be used against capital gains. Buying and selling costs such as agent fees and taxes on the transfer change both numbers and are converted on their own dates. Source: RBA, F11.1 Exchange Rates, retrieved 9 October 2026; arithmetic ours.
Converting the whole sale at an annual average rate, or at the rate on the day the money arrived in Australia, is a common shortcut. It does not follow the rule for capital assets and can move the result by tens of thousands of dollars in either direction.
If it was your home before you moved here
Many overseas properties were the family home before the move. The main residence exemption is not limited to Australian homes, and the ATO addressed this situation directly in Taxation Determination TD 95/7. A person who owned a home overseas that stopped being their main residence when they became an Australian resident can choose to keep treating it as their main residence during their absence, subject to the usual conditions of that rule.
The usual conditions, from the ATO’s guidance on treating a former home as your main residence (QC 66030):
- If the property was rented out, the choice covers up to 6 years of absence. If it was left vacant or used by family without rent, the period is unlimited.
- While you make this choice, you cannot treat any other property as your main residence, apart from an overlap of up to 6 months when moving house. If you bought a home in Melbourne or Brisbane during that time, choosing the overseas apartment means the Australian home is not your main residence for the same period.
- The property must have been your main residence first. A property you bought overseas and rented out from the start does not qualify.
TD 95/7’s own example is a UK resident who moved to Australia in 2007, rented out her UK home, bought nothing here, and sold the UK home the following year. Her choice meant the gain was disregarded. Where the family has a home in Australia as well, the choice is a trade-off between the two properties, and it is usually worth running the numbers both ways before lodging.
Tax already paid overseas
If the other country taxed the sale, the tax paid on the gain may be claimed as a foreign income tax offset against the Australian tax on the same gain. In the 2026 myTax instructions (QC 106756), if the total foreign tax you paid during 2025-26 is $1,000 or less, the amount you paid is entered directly. If it is more than $1,000, you need to work out the offset limit, and the offset can be less than the tax you paid overseas. Keep the overseas tax receipt or assessment that shows the amount, the date and what it was charged on. Only foreign income tax counts toward the offset. Transfer duties, value-added taxes and similar charges on the transaction are not income tax, although some of them may form part of your selling costs.
What to gather before you lodge
- Your residency timeline. The date you became an Australian resident for tax purposes, your visa history, and when you or your spouse became a permanent resident or citizen.
- The sale contract with the date it was signed and the price. The contract date decides the income year.
- Evidence of market value on the day you became a resident, or the original purchase contract if you were already a resident when you bought.
- Buying and selling costs with dates: agent fees, legal fees, transfer taxes and any capital improvements made after you became a resident.
- Exchange rates for each date. The ATO publishes rates and uses the Reserve Bank of Australia’s rates.
- How the property was used while you lived in Australia: rented, vacant, or used by family. This decides whether the main residence choice is available.
- Overseas tax documents for any tax paid on the sale.
If you lodge your own return, the 2025-26 return is due 31 October 2026. If you use a registered tax agent, you need to be on the agent’s client list by that date to use the agent’s later due date, and that only works if your earlier years are up to date. Our article on overdue returns and the 31 October deadline explains how that interacts with prior years.
💡 In one line: an Australian resident who sells property overseas reports the gain here, starting from the market value on the day they became a resident, with each amount converted on its own date. A flat price in the local currency can still mean an Australian gain.
Related reading: money sent from overseas and what to declare (in Chinese), the clearance certificate when you sell property in Australia, and tax planning versus compliance.
Frequently asked questions
I sold my apartment in China this year. Do I have to declare it in Australia?
Yes, if you were an Australian resident for tax purposes and not a temporary resident when you signed the sale contract. The ATO treats capital gains on overseas assets the same way as capital gains on Australian property. A contract signed between 1 July 2025 and 30 June 2026 belongs in the 2025-26 return, even if settlement or the transfer of money happened later. Source: ATO, QC 45588 and QC 66016, retrieved 9 October 2026.
What cost do I use if I bought the property before I moved to Australia?
Usually the property’s market value on the day you became an Australian resident for tax purposes. The ATO calls this deemed acquisition: you are treated as acquiring the asset on that day at its market value. It does not apply to assets acquired before 20 September 1985 or to taxable Australian property, and it does not apply if you were a temporary resident immediately after becoming a resident. Source: ATO, How changing residency affects CGT, QC 66059, last updated 22 June 2026.
Which exchange rate do I use?
For a capital asset, each amount is translated at the exchange rate at the time of the relevant transaction or event. The cost is converted on the day of acquisition, which for a deemed acquisition is the day you became a resident, and the sale price on the contract date. Costs are converted on the dates they were incurred. The ATO publishes exchange rates and uses the Reserve Bank of Australia’s rates. Source: ATO, Translation (conversion) rules, QC 17061, retrieved 9 October 2026.
I am on a temporary visa. Do I pay Australian tax on selling my home overseas?
Generally no. If you are a temporary resident, your capital gains are taxed in the same way as a foreign resident’s, which means only taxable Australian property, such as real estate in Australia, is subject to Australian CGT. You are a temporary resident if you hold a temporary visa and neither you nor your spouse is an Australian citizen or permanent resident. Source: ATO, QC 66059 and QC 69714, retrieved 9 October 2026.
Can the overseas property be exempt as my main residence?
It can be, in some cases. Under TD 95/7 a person who owned a home overseas that stopped being their main residence when they became an Australian resident can choose to continue treating it as their main residence while absent. If it was rented out, the choice covers up to 6 years; if not, it is unlimited. While the choice applies, no other property can be your main residence except during a move of up to 6 months. Source: ATO, TD 95/7 and QC 66030, retrieved 9 October 2026.
Talk it through
Send us the sale contract, the date you became an Australian resident for tax purposes, what you know about the property’s value at that date, and how the property was used while you lived here. We will work out the Australian dollar figures on the correct dates, check whether the main residence choice is worth making, and put the result into your 2025-26 return.
Book a 20 minute call, or phone us: Melbourne 03 9600 0803 | Brisbane 07 3188 8081.
An overseas sale rarely sits alone in a return. The same year often has rental income from an Australian property, foreign bank interest and a decision about where the sale money goes next. At Wiselink those are handled in one practice, split by function, with senior review on work that carries risk, so the capital gain, the foreign income and the main residence choice line up across both properties. Our accounting and tax services page lists the rest.
Credentials: CPA, Registered Tax Agent, ASIC Registered Agent, NTAA member, Xero, MYOB and QuickBooks partner, in practice since 2013. Our registration can be checked on the TPB public register. We work in English and Mandarin.
Melbourne Camberwell (1381 Toorak Rd, Camberwell VIC 3124) · Brisbane Eight Mile Plains (3 Clunies Ross Court, Eight Mile Plains QLD 4113)
Sources
- ATO, Capital gains on overseas assets (QC 45588).
- ATO, Your residency status and CGT (QC 69714), last updated 22 June 2026.
- ATO, How changing residency affects CGT (QC 66059), last updated 22 June 2026.
- ATO, CGT events (QC 66016), last updated 22 June 2026.
- ATO, Translation (conversion) rules (QC 17061).
- ATO, Taxation Determination TD 95/7, consolidated 12 May 2010.
- ATO, Treating former home as main residence (QC 66030), last updated 22 June 2026.
- ATO, myTax 2026 Foreign income tax offset (QC 106756), published 1 June 2026.
- Reserve Bank of Australia, F11.1 Exchange Rates, AUD/CNY daily rates.
All sources retrieved 9 October 2026. The property values in the worked example are illustrative and do not describe a client; the exchange rates are the RBA’s published rates for the dates shown, and the Australian dollar figures are our arithmetic. This article is general information and does not take your circumstances into account. Liability limited by a scheme approved under Professional Standards Legislation.
Reviewed by Lily Zhang, CPA and registered tax agent, founder of Wiselink Accountants. Wiselink has worked with small businesses and individual taxpayers in Melbourne and Brisbane, in English and Chinese, since 2013.
