Forman Financial Services

Foreign resident CGT withholding

From 1st July 2016, where a foreign resident disposes of taxable Australian property (this includes land, residential and commercial property, mining/quarrying/prospecting rights, and some indirect interests in these things), the purchaser must withhold 10% of the purchase price and pay that amount to the ATO.  Withheld amounts will then be used to offset the foreign residents CGT liability in respect of the disposal.

However, an exemption applies for any real property transactions with a market value less than $2 million. While this means that you will generally not have to withhold on the purchase of houses apartments from foreign residents, they may need to do so for high value residential or commercial property transactions.

For more information on this subject feel free to get in touch with us click here

To receive free updates on relevant information click here

To read more about specialised service offers for Financial Planning please click here