What a treaty is in Australian law
Treasury says Australia's tax treaties are given the force of law by the International Tax Agreements Act 1953. Treasury publishes a table of income tax treaties with the status of each, the dates it entered into force, and whether the Multilateral Instrument (MLI) modifies it. The table was last updated on 24 March 2026 and has 47 entries. The ATO also publishes lists in its foreign income tax offset guide.
The two official lists do not match exactly. The ATO's 2026 foreign income tax offset guide includes Croatia, Portugal, Slovenia and Ukraine, each marked "not yet entered into force as at 18 March 2026", and these are not in Treasury's table as updated in March 2026. The ATO lists Greece for an airline profits agreement only. Check both lists, and the treaty status, for your country.
Neither Hong Kong nor the United Arab Emirates is on the ATO's list of treaty countries. The ATO has a separate list of nine jurisdictions with agreements for the allocation of taxing rights: Aruba, the British Virgin Islands, the Cook Islands, Guernsey, the Isle of Man, Jersey, the Marshall Islands, Mauritius and Samoa. Hong Kong and the UAE are not there either. Where no treaty exists, relief depends on each country's domestic law.
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What a treaty says about property: one example
The 2003 Australia-United Kingdom convention is published by the UK government. It is one example, and other treaties are worded differently.
- Article 6 (income from real property). Income a resident of one country derives from real property may be taxed in the country where the property is situated.
- Article 13 (alienation of property). Income or gains a resident of one country derives from selling real property in the other country may be taxed in that other country.
- Article 22 (elimination of double taxation). The UK allows Australian tax paid under Australian law and the convention on income or gains from Australian sources as a credit against UK tax. Australia does the same for UK tax on UK-source income of an Australian resident.
So a UK-resident landlord with an Australian rental pays Australian tax under Australian rules, and the UK credits it. The foreign resident tax rates show what Australia charges.
Two directions, two kinds of relief
| Your situation | Where the property is | Who taxes first | Where relief comes from |
|---|---|---|---|
| Foreign resident for Australian tax | Australia | Australia, on Australian-sourced rent and gains | Your home country's rules, such as a credit for Australian tax |
| Australian resident for tax, living abroad | Overseas | The country where the property sits may tax it, under its own law and any treaty | Australia: the foreign income tax offset |
The ATO says the foreign income tax offset mainly applies to Australian resident taxpayers. To claim it you must have paid, or be deemed to have paid, foreign income tax, and the income must be in your Australian assessable income. If you claim $1,000 or less, you only need to record the foreign tax paid. The offset cannot exceed the Australian tax payable on that foreign income. The ATO's rental income page says you can claim the offset for tax paid on rent from a property in another country.
The ATO adds that in very limited circumstances, foreign tax imposed on Australian-source income may count towards the offset. That is the exception. A foreign resident with Australian rent should expect relief to come from home.
Worked example with made-up rates
The rates below are invented to show the mechanics and do not describe any country. A foreign resident has $30,000 of net Australian rent. Australia taxes it at 30%: 30% x $30,000 = $9,000. Assume the home country taxes the same rent and gives a credit for Australian tax, capped at the home country's own tax on that income.
| Home country rate | Home tax before credit | Credit | Home tax payable | Total tax on the rent |
|---|---|---|---|---|
| 25% | 25% x $30,000 = $7,500 | lower of $9,000 and $7,500 = $7,500 | $0 | $9,000 |
| 40% | 40% x $30,000 = $12,000 | lower of $9,000 and $12,000 = $9,000 | $12,000 - $9,000 = $3,000 | $9,000 + $3,000 = $12,000 |
In both cases the rent is not taxed twice in full. The higher of the two countries' rates sets the total.
What to check for your country
- Whether a treaty exists with your country, using the Treasury and ATO lists, and its status.
- The treaty articles on income from real property, gains from real property and elimination of double taxation. The UK convention numbers them 6, 13 and 22, and numbering may differ.
- Whether the MLI modifies the treaty, which Treasury's table shows.
- How your home country gives relief and when it expects its own return.
- Residency. The ATO says tax residency can depend on treaties, so the residency tests are a starting point, not the whole answer.
The overview of tax on Australian property has a country table, and the country pages such as from the United Kingdom cover each market.
Keep reading
- Tax for Australian expats: what the ATO expects while you live overseas
- Tax on rental income for non-resident landlords: how the ATO treats rent from Australia
- Foreign resident tax rates for 2026-27: what the ATO charges non-residents
- Australian tax residency tests explained: are you a resident or a foreign resident?
- Do Australian expats pay the foreign buyer stamp duty and land tax surcharges?
- HECS-HELP repayments when living overseas: what the ATO requires and what it means for a home loan
Frequently asked questions
Does Australia have a tax treaty with Hong Kong or the UAE?
Not on the lists the ATO and Treasury publish, as checked on 7 October 2026. Neither is on the ATO's separate list of taxing-rights agreements. Without a treaty, relief depends on each country's own law, so a tax adviser who knows both systems is the one to ask.
If there is a treaty, do I still pay Australian tax on my rent?
Often yes. In the UK convention, income from real property may be taxed in the country where the property is situated, and the home country gives the relief by allowing a credit. Other treaties can differ, so the treaty text for your country decides. Where there is no treaty, each country's domestic law applies.
Can a foreign resident claim Australia's foreign income tax offset on Australian rent?
Generally no. The ATO says the foreign income tax offset mainly applies to Australian residents who paid foreign tax on foreign income that is in their Australian assessable income. Relief for tax paid in Australia comes from your home country's system, such as the credit in Article 22 of the UK convention.
What is the Multilateral Instrument?
Treasury says the MLI is given the force of law by the International Tax Agreements Act 1953. It modifies many of Australia's tax treaties, and Treasury's table shows which, with the dates it takes effect. The ATO prepares synthesised texts for some treaties. A synthesised text helps readers but is not a source of law.
Sources
- Income tax treaties, Treasury
- Tax treaties, Treasury
- Foreign income tax offset rules guide 2026, Australian Taxation Office
- Foreign income tax offset rules guide 2026: eligibility, Australian Taxation Office
- Foreign income tax offset: calculate your offset limit, Australian Taxation Office
- Foreign income tax offset: countries and jurisdictions with a tax treaty, Australian Taxation Office
- Foreign income tax offset: agreements for the allocation of taxing rights, Australian Taxation Office
- Rental income you must declare, Australian Taxation Office
- Work out your tax residency, Australian Taxation Office
- 2003 Australia-UK Double Taxation Convention, GOV.UK
Checked 7 October 2026.
Expat Finance is an independent guide. It is not a lender, mortgage broker or credit provider, it does not hold an Australian credit licence, and it does not give credit, legal, tax or migration advice. It is not affiliated with any bank, the ATO or the Foreign Investment Review Board. General information only, not legal, tax, migration or financial advice.