Webinar: Expert Insights on Australian Property Market for Aussie Expats in the Asia Pacific Region

Non-residents of Australia can generally stay in Australia for up to 183 days in a tax year before potentially being classified as tax residents. This is based on the “183-day rule,” which is a common guideline used to determine tax residency.

If a non-resident stays in Australia for 183 days or more within a financial year, they may be considered an Australian tax resident, depending on other factors such as the purpose of their stay and their ties to Australia.

Australian Permanent Residents living outside Australia are generally classified as non-tax residents. This means they are only taxed on Australian-sourced income, such as rental income from properties in Australia. 

However, they are not eligible for the Capital Gains Tax (CGT) exemption for their main residence, and their rental income may still be eligible for negative gearing benefits.

Non-residents can carry forward tax losses, including those from rental properties, to offset future income. Negative gearing benefits are still applicable for non-tax residents, which helps minimise their Australian tax liabilities on rental income.

When purchasing property through a family trust, lenders will evaluate the trust’s financial position, assets, and liabilities, which can complicate the borrowing process. Additionally, each lender may have different policies regarding lending to trusts, and rates or lending terms may vary based on the specific trust structure. There could also be limited lender options depending on how the trust is set up​.