Update to our Article - Looking to buy or sell a residential property? You may be affected by the ATO’s new tax laws
Property laws are constantly changing. To stay ahead of the game, you need to stay up to date on all the latest rules and regulations. If you are looking to buy or sell a residential property you may be affected by new ATO tax laws. The property experts at Selvaggio Lawyers have all the information you need to make sure you are adhering to the rules when selling or buying a property.
From 1 July 2017 there have been changes to the ATO tax laws.
The changes are:
- The threshold is now $750,000.00 or more. Reduced from $2million
- The withholding amount is now 12.5% of the price. Increased from 10%.
The new tax laws automatically apply to all sales of all properties after 1 July 2017 that have a market value of $750,000.00 or more. The laws apply to residential property, commercial properties and vacant land. If the new laws apply, the buyers of the property must withhold 12.5% of the sale price of the property and pay that amount to the ATO at settlement.
However, the new laws do not apply to properties which have a value of $750,000.00 by Australian Residents where the seller of the property has provided a ‘Clearance Certificate’ to the buyer on or before the date of settlement.
A Clearance Certificate can be obtained from the ATO here: https://www.ato.gov.au/Forms/Capital-gains-withholding-clearance-certificate-application-instructions---for-Australian-residents/
Further information can also be found here: https://www.ato.gov.au/General/Capital-gains-tax/In-detail/Calculating-a-capital-gain-or-loss/Capital-gains-withholding--Impacts-on-foreign-and-Australian-residents/
If you have any questions please do not hesitate to Contact Selvaggio Lawyers today to learn more about the new ATO laws and to arrange a consultation.Back