Foreign resident capital gains withholding regime

In brief - Foreign resident vendors, purchasers and advisers should consider impact on affected property transactions

Following the passing of the Tax and Superannuation Laws Amendment (2015 Measures No. 6) Act 2016, a new capital gains withholding tax regime came into effect on 1 July 2016. Under the new regime, purchasers of certain Australian assets from a "foreign resident" will be required to withhold and remit 10% of the total consideration to the Australian Taxation Office (ATO).

New capital gains withholding regime applies under certain conditions

The new regime aims to address the currently low tax compliance of foreign residents who dispose of real property, and interests in real property.