Are you selling a property for more than $2 million?

Many will now know that from 1 July, a 10% non-final withholding tax will apply to all Australian real property sales with a market value of $2 million or more, unless a clearance certificate is obtained.

From 1st July, 2016, vendors need to apply to the ATO for a clearance certificate, which will be issued to Australian residents.  The clearance certificate is then provided to the purchaser prior to settlement.  Foreign residents will be unable to obtain a clearance certificate. 

Buyers need to know

Buyers need to withhold 10% of the purchase price and pay it to the ATO, unless the vendor provides the buyer with a clearance certificate.  This applies for properties purchased for more than $2M.