Leaving Australia?

We hit a nerve.

Yesterday’s piece on Australians walking away from the Lucky Country lit up the inbox. The message from readers? Enough is enough. People aren’t just thinking about leaving. They’re trying to figure out how to do it cleanly. Not for a gap year. Not for Instagram. For good. For freedom. And they want to know the rules.

So here’s your how-to, straight up.

The first thing to understand is that you can’t just grab your passport, land in a foreign clime, and assume the taxman forgets you exist. That’s not how this works. The Australian Taxation Office has one of the most overreaching residency regimes in the world. It is designed to keep the leash tight even after you’ve walked out the front door. And no surprise, they don’t make it easy.

To be considered a non-resident for tax purposes, you need to do more than change your address. You need to change your life. The ATO looks at whether you “reside” in Australia, not in a spiritual sense but in a practical one. Do you have a permanent place of abode elsewhere? Have you cut ties here? Do you spend less than 183 days a year on Aussie soil? If the answer is yes, yes, and yes, you’re in the clear.

To cease residency, you need a paper trail that proves you're gone for good. That means a lease or property overseas, bills in your name, local accounts, and possibly a long-stay visa or residency permit. It also means reducing your footprint here. Keep your visits short. Rent or sell your house. Close local accounts if you don’t need them. Do not hang around in grey zones. The ATO loves grey zones. They feed off them.

Once you’ve genuinely left, you lodge a tax return that marks your departure. But don’t expect to go quietly. The ATO has one final swipe before you leave, and it’s a beauty. Under the “deemed disposal” rules, they’ll treat certain assets like they were sold the day you left. That means capital gains tax, even if you haven’t sold a thing. Welcome to CGT event I1 (which includes crypto, shares, managed funds.) You’re potentially taxed on all of it unless you elect to defer the hit until you actually sell. The trap is real. Get good advice before you trigger the paperwork.

Now, here’s the upside. Once you’ve properly ceased residency, the ATO no longer taxes your foreign income. That’s the jackpot. If you’re earning online, consulting, running a business, or investing overseas, you’ve just escaped the system. You don’t pay tax in Australia on money that never touches its shores. You’ve gone from being a walking wallet to a free citizen.

But the game is tightening. The government has woken up to the fact that people are opting out. That’s why you need to do it right. Not half right. Not “I read on Reddit” right. Not even "I read it on Confidential Daily" right. I mean properly right. That means seeking professional advice, rather than the general advice being provided here.

Now, to some myths. You don’t need to cancel Medicare when you leave. You simply can’t use it overseas, with the exception of a few countries with limited reciprocal public arrangements. You’ll need private health cover wherever you go. As for your private Aussie health insurance, you don’t have to burn it to the ground. Most funds let you suspend your policy while you’re overseas. That way, you avoid waiting periods and keep your Lifetime Health Cover loading intact if and when you return.

And what about retirees? Yes, the Age Pension can be paid overseas. But there’s a catch. If you stay out longer than 26 weeks, the amount you receive may be reduced depending on how long you worked in Australia. If you haven’t clocked up 35 years of working-age residence, your pension gets proportioned. That’s the “thanks for your service, now off you go” clause.

So, the checklist is simple. Establish a new life. Prove it. File correctly. Manage the CGT exit rules instead of stumbling into them. Suspend private health rather than torch it. Be aware of the pension rules before you move. And, most importantly, get professional advice!

If you’re going to leave, do it properly. Don’t let the bureaucracy trap you in no-man’s land. The system is hoping you don’t read the fine print. But you just did.

“Loving life is easy when you are abroad. Where no one knows you and you hold life in your hands all alone, you are more master of yourself than at any other time.”
– Hannah Arendt