As from July 1stthe new Clearance Certificates become mandatory for anyone who is selling a property over the price of $750,000.00.
Please see below information that will assist you in understanding how this new legislation will affect you.
Where a Seller is an Australian resident and wishes to obtain a Clearance Certificate from the ATO to avoid part of the proceeds of their sale being withheld, they would be wise to apply for the certificate well in advance of settlement.
Where there are multiple Australian resident Sellers disposing of the asset, each Seller should apply for a separate clearance certificate in their name only.
Australian residents not required to lodge tax returns, such as aged pensioners, are still required to obtain a clearance certificate.
Once a Certificate is received it remains in place for twelve (12) months.
We direct all our Sellers to apply for a Clearance Certificate by followingTHIS LINK
Where the Seller is NOT an Australian resident or CANNOT obtain a Clearance Certificate they may be entitled to apply for a Variation (to the Withholding Rate). For an explanation of when a Variation can be applied for, please useTHIS LINK
For full instructions on applying for a Variation please useTHIS LINK
We hope that this information will help you understand the new rules applying to all sales over $750,000.
For further information about the CGT Withholding provisions Sellers and Buyers should seek professional advice or contact the ATO.