Key Points:
The Federal Government intends the CGT Withholding
Regime to apply from 1 July 2016.
If legislation currently before the Commonwealth Parliament
passes, from 1 July 2016 a purchaser of Australian land or an
interest in Australian land may be required to withhold 10% of the
purchase price on account of the vendor's potential Capital
Gains Tax (CGT) liability and to pay this amount
to the Australian Taxation Office (ATO).
Significant penalties will apply for a purchaser's failure to
do so.
New CGT withholding regime
The Tax and Superannuation Laws Amendment (2015 Measures No. 6)
Bill 2015 proposes to introduce a new non-final withholding tax
regime to assist in the collection of CGT from foreign residents.
Although this new regime has been publicised as targeting foreign
resident vendors, it will impact all vendors and purchasers of
Australian land.
