Capital Gains Tax
Reviewed by A tax on the profit realised when an asset — such as real estate, securities, or company shares — is sold for more than its purchase price.
Capital gains tax is a tax on the profit realised when an asset — such as real estate, securities, or shares in a company — is sold for more than it cost to acquire. It is charged on the gain, not on the full sale price, and many countries provide exemptions for certain assets, minimum holding periods, or a primary residence.
For investment migration this matters because investors in real-estate or fund-based programmes should understand how gains on the qualifying investment and on other assets are taxed both in their former and their new country. Changing residency can change capital gains exposure.
Rates, exemptions, and holding-period rules depend heavily on the country, and some jurisdictions levy no capital gains tax at all, so the outcome must be assessed for each specific situation.
FAQ
Does obtaining a second citizenship or residence permit itself trigger capital gains tax?
No. Liability follows tax residency, the location of the asset and an actual disposal, not the holding of a passport or a residence card. Acquiring status is not in itself a taxable event.
What is an exit tax and does it apply when I relocate?
Some countries treat gains on certain assets as realized when you cease to be tax resident and tax them on departure. Whether such a regime exists, and on what terms, depends on the country you are leaving.
Does it matter whether I sell before or after changing residency?
It can: taxing rights usually depend on your residency at the moment of disposal and on where the asset is situated. Sequencing is best planned in advance with advisers in both jurisdictions.
Are currency movements taken into account?
Many countries compute the gain in local currency, so exchange-rate movement between purchase and sale affects the taxable base. Conversion rules vary by jurisdiction.
Are gains on assets held outside my new country of residence taxable there?
Frequently yes, since residents are often taxed on worldwide income, though some jurisdictions apply territorial or special regimes. The outcome depends on local rules and on any applicable tax treaty.