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ARTICLE · 12 JULY 2017

Changes to foreign resident capital gains withholding clearance certificates

Developers should be aware that an updated certificate must be applied for in the event that a project is delayed.

AustraliaReal Estate and Construction

IN BRIEF - WHAT THIS MEANS FOR DEVELOPERS

In the recent Federal Budget, changes to the threshold at which a clearance certificate is required and the amount to be remitted to the Australian Taxation Office (ATO) if no certificate is produced were announced. Developers should be aware that the clearance certificate is valid for any property sold in the 12 months from date of issue, and that an updated certificate must be applied for in the event that a project is delayed.

CHANGES TO CLEARANCE CERTIFICATE REGIME WILL TAKE EFFECT FROM 1 JULY 2017

The Federal Government has a regime whereby vendors of real estate in excess of $2 million have to provide purchasers with a clearance certificate on or prior to settlement or purchasers are mandated to retain and remit to the (ATO) 10% of the price.

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