Newsletter
April 2016 Newsletter
New rules for selling property over $2M
The new foreign resident CGT withholding tax applies to sales contracts entered into on or after 1 July 2016. A purchaser who buys an Australian real estate asset from a foreign resident vendor will be required to withhold and remit to the ATO 10% of the purchase price.
Solicitors and professionals who deal with property and unlisted interests in companies and trusts will need to adjust their conveyancing processes to deal with this withholding tax. A failure to do so could lead to a vendor losing 10% of their sale price immediately to tax or alternatively a purchaser being saddled with a withholding tax obligation that should actually be borne by the vendor.