[World Tax News] Australia Consults on Foreign Resident CGT | UK & Taiwan Updates

Editorial Team – [2026] 185 taxmann.com 543 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week:

1. Australia Seeks Public Consultation on Legislation to Strengthen the Foreign Resident Capital Gains Tax Regime

On 10 April 2026, the Australian Government released an exposure draft of legislation and accompanying explanatory material to reform the foreign resident capital gains tax (CGT) regime. The consultation, which closes on 24 April 2026, follows an announcement made in the 2024–25 Federal Budget. The proposed reforms are wide-ranging and, in several respects, retrospective, drawing significant attention from foreign investors and their advisers.

The centrepiece of the draft is a substantial expansion of the concept of “real property” in Division 855 of the Income Tax Assessment Act 1997. Under the proposed amendments, “real property” would be defined beyond its general law meaning to encompass any interest or right in Australian land and anything affixed to Australian land, a change proposed to apply retrospectively from 12 December 2006. This retrospective application has drawn sharp criticism from foreign investors, who argue it exceeds previously understood domestic and treaty limits and is likely to trigger significant legal challenges. The draft also clarifies that state and territory property law severance provisions do not determine which assets fall within the foreign resident CGT regime, resolving a longstanding area of uncertainty.

The Government has also proposed a time-limited 50% CGT discount for foreign resident investors in Australian renewable energy assets, applicable to CGT events occurring from the date of commencement of the legislation through to 30 June 2030. This concession is restricted to non-individual foreign residents (i.e., foreign companies and foreign trusts) and is positioned as a targeted incentive to attract foreign capital into Australia’s clean energy transition. Submissions to the consultation may be lodged through the Treasury website until 24 April 2026.

Source – Australian Treasury – Consultation on Foreign Resident CGT Legislation (April 2026)

2. UK HMRC Issues Self-assessment Help Sheet on New Foreign Income and Gains Regime

On 10 April 2026, UK HM Revenue & Customs (HMRC) published the updated Self-Assessment Helpsheet HS266 – “Foreign Income and Gains (FIG) Regime (2026)”, providing official filing guidance for individuals claiming relief under the new FIG regime for the 2025–26 tax year. The FIG regime, which came into effect on 6 April 2025, replaced the previous remittance basis of assessment and fundamentally restructures how foreign income and gains are taxed for new arrivals to the United Kingdom.

Under the FIG regime, a “qualifying new resident” is defined as an individual in one of their first four tax years of UK residence following a period of at least 10 consecutive years of non-UK residence and may claim full UK tax relief on foreign income and gains arising during those four years. Unlike the former remittance basis, amounts relieved under the FIG regime can be freely remitted to the UK without triggering any additional tax liability, removing a significant barrier that previously deterred wealthy individuals from relocating to the UK.

The help sheet also clarifies transitional provisions for those who became UK residents before 6 April 2025 – individuals who first became UK residents from the 2022–23 tax year onwards may access the regime for the remaining years of their four-year qualifying window. Claims for the 2025–26 tax year must be made in the relevant Self-Assessment return, with a filing deadline of 31 January 2027 and a claim amendment deadline of 31 January 2028. HMRC’s updated guidance is particularly relevant to high-net-worth individuals, internationally mobile executives, and their advisers.

Source – HMRC – HS266 Foreign Income and Gains Regime (2026)

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