What’s changed with Foreign Resident Capital Gains Withholding?

From 1 January 2025 the Foreign Resident Capital Gains (FRCG) withholding regime will now apply to all sales of real estate in Australia, previously this only applied for sales of real estate of $750,000 or more.

If you’re a seller whose contract was executed on or after the 1 January 2025, regardless of whether you’re an Australian resident taxpayer or not, you’ll need to obtain a Clearance Certificate from the Australia Taxation Office at https://www.ato.gov.au/FRWT_Certificate.aspx

If you don’t, the purchaser is obligated to withhold 15.0% of your sale proceeds at settlement and the amount withheld will be credited to your income tax account.  This could be inconvenient.

For more information about FRCG withholding, please contact Glenferrie Conveyancing in Northcote at 03 9815 2351.