Big changes are coming to foreign resident capital gains withholding laws, and they’re now officially locked in.
If you’re selling certain taxable real property (like Australian land), these rules apply to you—even if you’re an Australian resident. Here’s why:
Under these laws, if you don’t have a valid ‘clearance certificate’ from the ATO at or before settlement, the buyer must withhold a portion of the sale proceeds and send it straight to the ATO.
So, what’s changing?
- The withholding rate is increasing from 12.5% to 15%.
- The previous $750,000 threshold is being scrapped entirely.
This means all disposals of taxable real property could be subject to withholding, regardless of the sale price. These changes take effect from 1 January 2025, so if you’re planning a sale, it’s important to be prepared.
Got questions? Reach out to your contact at Quantiphy—we’re happy to help.
