Property Withholding Tax Effective 1st July 2017 03/07/2017
From 1st July 2017, ALL real estate sold throughout Australia with a value in excess of $750,000 will come under the newly introduced ‘withholding tax’ legislation.
First introduced several years ago, property withholding tax was initially implemented by the ATO (Australian Taxation Office) to ensure that foreign investors selling Australian property with a value in excess of $2 million paid Capital Gains Tax due and applicable to their transaction, prior to transferring sale funds back overseas.
Recently however, the ATO has seen it fit to lower the threshold from $2 million to $750,000.
2 Butcher Road, Roleystone - SOLD in 3 Days
Sellers of Australian property in excess of $750,000 will now be required to obtain a ‘clearance’ certificate directly from the ATO. Fortunately, this is a very simple process which can be done directly form the ATO website.
The subject clearance certificates must be supplied to the purchaser at the time of settlement. In the event a clearance certificate is not supplied, then the purchaser is required to withhold 10% of the purchase price.
Please feel free to contact us anytime with questions in relation to the withholding tax legislation.